Nearly all employees are concerned about their finances, and almost half say they’re just getting by, finds new research released today by SoFi.
According to SoFi’s second annual report, “The Future of Workplace Financial Well-Being: 2024 Employer & Employee Perspectives,” 48% of workers are worried they don’t have enough saved in an emergency account, and 45% are stressed about their lack of funds for retirement.
Even more telling, the number of workers who say they are not stressed about money decreased nearly 50% since SoFi’s last report.
As a result, workers are prioritizing their short-term savings. Forty-seven percent of workers say funding a rainy-day account is their top priority this year, a 20% increase from 2022, and 40% intend to pay off their credit card debt.
Others look to their employers for support on their finances, and specifically with paying off student loan debt. According to SoFi, 78% of employees say they cannot contribute as much to their retirement because they’re allocating towards their student loans.
Not only do employees want programs that will help them reach their financial goals, but they are also likelier to stay with their employer long-term if the organizations offers employee benefits, as three in four workers say having these workplace features would incentivize them to stick with their company.
“The results show that while progress toward providing financial wellbeing benefits is being made, significant disconnects remain between what employees need and what companies offer. Fortunately, solutions are well within reach,” reports SoFi’s findings.
For these reasons, SoFi’s research finds 40% of human resource (HR) leaders plan to offer student loan 401(k) matching programs and pre-tax emergency savings accounts in 2024.
The research also lists employer 401(k) matches as the most enticing employee benefit for workers, as one in five employees borrowed or withdrew from their retirement savings in 2023.
Twice as many employees also report wanting to improve their financial literacy, indicating a clear opportunity here for employers and retirement plan advisors to connect with participants on financial wellbeing tactics, adds SoFi.
The findings show that while 55% of employees want a 401(k) plan and 43% are interested in retirement matching features, of the 78% of companies who offer a match, 12% to 15% of employees do not take advantage of it. The disconnect offers a chance for plan sponsors to improve their education and communication strategies.
“While employees rank financial advisors as their top source for financial advice and resources, they also turn to HR leaders and company financial education resources, indicating a strong level of trust in employer resources,” notes SoFi.
SoFi’s report surveyed 750 HR leaders and 750 employees between the ages of 18 to 70. More findings from the study can be found here.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.