More than half of respondents to a new survey worry about personal finances at work at least once a week, causing workplace distraction and loss of productivity.
More shockingly, this loss of productivity combined with absenteeism from financial stress has major impact on organizations, costing more than an estimated $1,900 per year, per employee, and totaling an estimated annual loss of $1 million for midsized employers and $19 million for large employers.
The survey, from John Hancock Retirement, did find that employer financial wellness programs may improve job retention, stress levels, and job productivity.
Seventy-seven percent of respondents find financial wellness programs important and seven in 10 feel these programs have helped reduce their financial stress and increased their loyalty to their employer.
While 88% of employers say they currently have or are developing a financial well-being strategy, only 20% of participants claim their employer offers anything more than a limited financial wellness program.
“Our 2019 Financial Stress Survey highlights a downward trend on retirement readiness and indicates participants’ financial situations are at risk, with 36% of participants responding they are not in a good financial situation,” Patrick Murphy, CEO of John Hancock Retirement said in a statement. “Seventy-one percent of participants are worried about having financial difficulties—the most we have seen from this survey in the past six years.”
No. 1 financial worry
Year over year, the number one financial worry is saving for retirement, except for those with student loan debt. Higher than in previous years, as much as 51% of workers consider themselves behind schedule when it comes to saving for retirement.
Lack of emergency savings is the number two financial worry among all participants, and 25% have no emergency savings at all, which is even more pronounced for Generations X, Y, and Z where almost a third are in that position.
The survey also found that fewer people are taking action to help their financial situation, with only about one of four respondents having met with a financial advisor, contributed to an IRA or allocated to a health savings account.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.