Data & Research April 9, 2015

Five Signs of Employee Financial Stress

Worksite wellness education can help employees ease economic stress and counteract these distractions.
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Employers should be on the watch for five clear signs to see if their employees are undergoing financial stress—a known risk factor for distractions at work and lower productivity, according to Purchasing Power, an employee benefits company. The signs are:

Asking for hardship withdrawals or loans from their retirement plan;

Asking for salary advances;

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Taking unexpected days off;

Incurring medical costs that could have been prevented by routine checkups; and

Spending time dealing with personal financial issues while on the job.

A vast majority of full-time employees (80%) say they have financial stress, and 33% of employees spend an average of 1.7 hours a week dealing with personal finances while at work, according to a Harris Poll conducted in July 2014 on behalf of Purchasing Power.

Many employees are bringing their financial worries with them to work, says Elizabeth Halkos, chief revenue officer of Purchasing Power. “Ultimately, financial stress becomes a distraction while at work [and] employees with financial issues don’t know how to resolve their situation.”

Working with their retirement plan advisers, plan ponsors should proactively look out for these signs of financial stress and offer financial wellness education, Halkos suggests. In fact, Purchasing Power found through asurvey that 40% of employees would take advantage of a financial wellness education program offered by their or their spouse’s employer. By helping employees improve their bottom line, the employer inevitably improves their bottom line as well, she says. 

Data & Research April 9, 2015

Americans Define Financial Success as Being Able to Retire Comfortably

In the past, home ownership served as the benchmark.
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With a greater emphasis on retirement savings taking hold in the nation, Americans’ views on prosperity are being reshaped, according to a telephone survey of 1,010 adults conducted by Harris Poll for the American Institute of CPAs (AICPA).

Nearly one-third of those polled (28%) said that being able to retire comfortably is the earmark of financial success, compared to 11% who said owning a home and another 11% who said being better financially situated than their parents.

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“We’re seeing that today’s American dream is greatly shifted from the one defined by previous generations,” says Ernie Almonte, chairman of the AICPA CPA Financial Literacy Commission. “Whether the reason is the lingering result of the housing bust of difficulty getting ahead in a still recovering economy, it’s clear that Americans have changed the benchmarks for their financial success.”

And Americans are optimistic about their financial prospects and are taking positive action, with 21% reporting that they have already achieved financial success and another 52% believing that they will be able to do so in their lifetime. Since the recession of 2008, 85% have made positive changes to their financial behavior, with 58% following a monthly budget, 50% consciously charging less to their credit cards, 44% starting to save or increasing their savings, 35% putting away money in an emergency fund, and 32% starting or increasing contributions to their retirement account.

AICPA suggests four steps that Americans can take to improve their financial health: 1.) Set and follow a budget; 2.) Set concrete financial goals; 3.) Reduce debt; and 4.) Be aware of their temptations.

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