People in Denver and Sacramento have the highest financial stress levels in the country, according to a new survey released June 11 by Boston-based Salary Finance, which partners with employers to offer financial wellness solutions.
Denver’s 55% financial stress level apparently led to Colorado topping the survey’s list of the top 10 states with the most financial worries as well, at 54% compared to tied-for-second Texas and Florida at 51%.
California, Tennessee, Kentucky, West Virginia and Indiana all tied for fourth at 50%, while Washington and Oregon tied for ninth with 48% or residents reporting having “financial worries.”
As for the other cities on the list, Sacramento tied with Denver at 55%, followed by Dallas (54%) and San Francisco (53%) in the third and fourth spots. Florida cities Tampa and Miami were next at 52%, followed by Oklahoma City (51%), Pittsburgh (50%), Los Angeles (49%) and San Diego (48%) to round out the top (bottom?) 10.
Crank up those financial wellness programs!
According to the Salary Finance survey, financial stress affects close to half (48%) of the U.S. workforce. Judging by that, it looks like the market for financial wellness programs has plenty of room for growth in coming years.
The survey says the financial stress is particularly concentrated in the West Coast, Appalachia and the Great Plains, where more than half of American workers admit to experiencing financial stress.
The survey found money worries have a devastating impact on Americans’ mental health; employees under financial stress are over three times more likely to suffer from anxiety and panic attacks and four times more likely to suffer from depression and suicidal thoughts.
Women particularly suffer; 56% of working women are stressed about their finances and, even more concerning to the retirement planning industry, 63% feel they do not earn enough to save.
Income not always indicator of financial wellness
It is conventional wisdom that only those with low incomes live paycheck to paycheck. While lower average incomes in some of the worst-impacted regions might seem like a ready culprit for financial stress, the survey indicated that income is not an indicator of financial wellness. Forty percent of Americans earning more than$100,000annually are financially unstable, with less than three months’ savings.
The study reveals that one in four Americans living paycheck-to-paycheck with no savings earns over$160,000.(But you know they’re still regular customers at Starbucks, probably drive a newer car, have the latest iPhone, and likely eat out multiple times each week!)
The survey revealed financial stress also impacts employees’ work performance (something that has been well-documented in previous studies). Twenty-two percent of stressed employees cannot finish daily tasks and 24% have troubled relationships with coworkers.
Employees with money worries lose nearly one month of productive work days per year and are over two times more likely to be seeking a new job. Combined, these factors cost American businesses$500 billionper year and 11-14% of payroll expenses.
Employers can help
Employers could have a role in reducing financial stress. According to the survey, 79% of employees trust their employers with their financial information and 68% feel their employer cares about them and their wellness.
Offering financial wellness benefits reduces employee turnover, according to a recent Harvard study.
“Failing financial wellness is an alarming national trend with severe health and business costs, not only for the worst-impacted regions but across the entire country,” said Daniel Macklin, Salary Finance U.S. CEO. “Debt is the leading cause of financial stress, so financial education and debt consolidation and reduction programs are the best place to start for employers looking to reduce their employees’ financial stress and improve ROI.”
Salary Finance commissioned an independent survey and report about U.S. employees’ financial concerns. The independent survey and report were developed in consultation with Dr. Annie Harper, a Yale University researcher who focuses on behavioral health and household finance, particularly in regard to how people cope with financial difficulties.
The survey was completed in late 2018 by 10,481 respondents across 26 industry sectors. Respondents were screened on the basis of whether or not they were employed. The survey was weighed against the U.S. Census Bureau Current Population Survey for age, gender, and region of the U.S. to be representative of the population.
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