As U.S. workers grapple with competing costs in an inflationary market, almost all admit they’re struggling to keep up with their finances and experiencing significant financial stress. As a result, many are unsure whether they’ll be able to sustain a retirement in the long-term.
Those are the latest findings from Willis Towers Watson’s 2024 Global Benefits Attitudes Survey, which found that 88% of American workers are financially stressed in meeting basic living costs, and nearly half (46%) are “extremely worried” about paying day-to-day expenses. Respondents said they’re worried about the costs of several basic living items, among the top being food (73%), healthcare (72%), housing (69%), and transportation (66%).
Such concerns are fueling a decrease in overall wellbeing—59% of respondents say their concerns about money have caused them to skip medical appointments and quality time with family and friends, and experience higher levels of stress and anxiety.
Exacerbated by the COVID-19 pandemic in 2020, financial anxiety levels among respondents have hit all-time highs as more battle competing priorities while trying to prepare for future emergencies. A 2024 report by Deloitte found that a growing number of participants now experience pandemic-related financial anxiety and are likelier to save and invest surplus cash rather than spend it.
“The pandemic has upended so many aspects of our lives,” Deloitte reports in its research. “How we feel about our personal finances is one of them.”
In fact, WTW found that participants are increasingly anxious about unexpected costs, to the point that a growing number plan to continue working past age 70, at 46% today vs. 30% prior to the pandemic.
“High inflation combined with the aftermath of a once-in-a-generation pandemic is causing many employees to feel overwhelmed and discouraged about their financial situation, which is affecting overall wellbeing,” said Mark Smrecek, senior director of Retirement at WTW. “Employers should take action to improve financial wellbeing within their organizations by adequately educating employees on their resources to close financial gaps and connecting employees with relevant elements of their total rewards package.”
This could include emergency savings features and other savings tools that prepare participants for anticipated and unexpected challenges. Two in three employees (66%) ranked financial wellbeing as the area where they want the most support from their employers over the next three years, while 47% of employees want employers to help grow their savings and wealth, 35% want help in making the most out of benefits, and 33% want access to emergency savings.
“Employer retirement programs, and specifically defined contribution plans such as 401(k)s, remain the primary path for employees to save for retirement,” said Beth Ashmore, managing director of Retirement at WTW. “With challenges meeting their day-to-day expenses while still planning for retirement, employees are looking for help from their employer to build a retirement nest egg, but they also report needing flexibility for emergencies and having a desire to maximize their benefits.
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- Gen Xers Nearing Retirement Report Median Savings of $50k
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.
