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New MassMutual Study Finds Widespread Worry Among Employers About Employees’ Financial Woes

December 3, 2019 GMT

SPRINGFIELD, Mass.--(BUSINESS WIRE)--Dec 3, 2019--

Eight in 10 employers say their employees are struggling financially as they face persistent problems such as saving for retirement, paying down debt and dealing with medical expenses, to name a few, according to new research from Massachusetts Mutual Life Insurance Company (MassMutual®).

The 2019 MassMutual Workplace Financial Wellness Study1 finds that 79% of employers say their workers are struggling financially. The larger the employer, the more likely respondents are to express concern about employee financial wellness issues.

“Our research finds that financial wellness issues are coming to roost at the workplace and that employers are acutely aware of their employees’ financial struggles,” said Ken Verzella, Head of Financial Wellness for MassMutual. “As long as workers struggle to overcome shorter-term financial issues such as eliminating debt and building emergency funds, they will be unable to save in any meaningful way for retirement and other long-term financial needs.”

Widespread Worries

Employer estimates vary about how many employees are plagued with financial problems. However, half of employers (51%) estimate that at least 25% or more of their workers struggle financially and 15% of employers say at least half of their workers are plagued by financial woes, the survey finds. Proof points for employees’ financial struggles include managers’ conversations with employees, employees’ lack of participation in retirement plans, working second jobs, taking loans from retirement plans, asking for paycheck advances and other indicators.

The most prevalent employee financial problems cited by employers include credit card or other consumer debt, day-to-day expenses for housing and childcare, the inability to save and prepare for retirement, a lack of emergency savings, and high medical costs, according to the study. In addition, employers expressed greater concern about some financial struggles than others.

Employer concerns about employees

Extremely
concerned

Somewhat
concerned

Total Concerned

Financial readiness for retirement

25%

42%

67%

Preparation for medical costs

28%

36%

64%

Participation in retirement plan

23%

39%

62%

Overall financial situation

23%

37%

61%

Handling emergency expenses

24%

34%

58%

Costs of childcare

16%

31%

47%

Credit card and consumer debt

12%

31%

43%

Student loan debt

12%

23%

35%

Different Sizes, Different Concerns

The specific financial issues plaguing employees seems to differ with the size of the employer. Larger employers are more likely to point to employees failing to participate in their employer-sponsored retirement plan or, if they do participate, withdrawing funds from their plan, the study finds.

 

Retirement assets under management (in millions)

Indicators of financial struggles

$1mm -- <
$5mm

$5mm - <
$15mm

$15mm --
<$25mm

$25mm --
$75mm

Lack of participation in retirement plan

44%

52%

49%

55%

Taking loans from retirement plan

42%

46%

52%

58%

Employees tell managers about financial struggles

42%

38%

46%

49%

A Call for Help

A majority of employers (57%) report that workers are seeking help with their personal financial problems from employers, according to the study. Another 17% of employers say they are unsure if employees want help through work. Again, the larger the employer, the more likely the company is to report that employees are seeking help, the study finds.

The need for financial assistance through the workplace is an opportunity for financial advisors who support workplace retirement savings plans such as 401(k)s to connect with and help more people, according to Verzella. Advisors can often tap into resources offered by retirement plan providers, he said.

“MassMutual is hearing from employers that sponsor retirement plans that employees not only need help but want assistance from their employer,” Verzella said. “MassMutual has introduced robust financial wellness resources for employers and their employees and we continue to build on those capabilities and offerings. The good news is that financial wellness is increasingly available through the workplace.”

About MassMutual

MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyowners. MassMutual offers a wide range of financial products and services, including life insurance, disability income insurance, long term care insurance, annuities, retirement plans and other employee benefits. For more information, visit www.massmutual.com.

1 2019 MassMutual Workplace Financial Wellness Study, https://retire.massmutual.com/retire/pdffolder/rs47968.pdf

RS-48069-00RS-48044-0

View source version on businesswire.com:https://www.businesswire.com/news/home/20191203005627/en/

CONTACT: David Potter

Media Relations

860-562-1525

dpotter@massmutual.com

KEYWORD: UNITED STATES NORTH AMERICA MASSACHUSETTS

INDUSTRY KEYWORD: BANKING PROFESSIONAL SERVICES FAMILY CONSUMER MARKETING INSURANCE ADVERTISING SENIORS HUMAN RESOURCES COMMUNICATIONS FINANCE CONSULTING

SOURCE: MassMutual

Copyright Business Wire 2019.

PUB: 12/03/2019 10:00 AM/DISC: 12/03/2019 10:01 AM

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