Prudential finds 22% of employees who are financially well may help advance business goals.
Financially fit employees may lead to a financially fit business.
When employees are financially well, employers may be better able to advance their business goals.
The “American Dream,” a shared ideal founded on individuals’ ability to achieve financial prosperity and security, is, for many Americans, slipping out of reach. In a recent Prudential survey regarding U.S. consumers’ perspectives on financial wellness, only 22% of individuals described themselves as feeling financially secure. Building upon employers’ realization of the value of employees’ health wellness over the past decade, there is growing acceptance among employers that there is significant value in improving employees’ financial wellness.
What is financial wellness?
Financial wellness is realized when individuals adopt behaviors that help them achieve the foundational elements of financial security:
Important Financial Goals
Against Key Financial Risks
What can employers do to help?
As long-standing providers of employee benefits, employers are viewed by employees as trusted partners who can help employees achieve financial wellness. Traditional workplace benefits programs are expanding to include new, complementary financial wellness approaches. Financial wellness programs focus on foundational financial issues, such as budgeting, debt management, saving and investing, and protecting against key financial risks.
What’s in it for employers?
When employees are financially well, employers benefit, too. Employers may be better able to advance their strategic business goals:
Investments in Employee Benefits
44% of employees worry about finances at work, and 46% spend two to three hours per week on personal financial matters at work.1
In 2012, employees withdrew $70 billion from retirement accounts before reaching retirement age. This equates to 59% of employers’ matching dollars contributed to those accounts that same year.2
44% of employees expect to retire later than planned.3 A one-year increase in retirement age costs employers about as much as paid sick and personal leave combined.4
How can employers maximize the effectiveness of their financial wellness programs?
Each employer has a unique business model and employee base, and, therefore, faces different challenges when implementing a financial wellness approach. Employers should design financial wellness programs that are informed by insights into the unique financial needs of their employees, successfully educate and engage employees, and help employees take concrete actions to improve their financial health. We encourage employers to discuss financial wellness with their benefit consultants or advisors.
1 Purchasing Power, “Financial Wellness: Addressing the ‘9 to 5’ Impact of 24/7 Financial Stress,” 2013. 2 HelloWallet, “The Retirement Breach in Defined Contribution Plans,” January 2013. 3 PricewaterhouseCoopers, “Employee Financial Wellness Survey 2016 Results,” 2016. 4 Prudential, with supporting research and analysis from the University of Connecticut’s Goldenson Center for Actuarial Research. A one-year increase in average retirement age, using national averages for private sector workers, results in an average annual incremental run rate of about 1%–1.5% of workforce costs.
The Prudential Insurance Company of America, Newark, NJ.
Prudential offers unique perspectives, based on insights gleaned from experiences as both a retirement and group insurance provider, on ways employers and their consultants or advisors can optimize their complete portfolio of benefit offerings.
LINK by Prudential is an umbrella marketing name for Prudential Customer Solutions LLC (“PCS”), Prudential Annuities Distributors, Inc. and various subsidiaries of The Prudential Insurance Company of America. Investment advisory products and services of LINK by Prudential are made available through PCS, an SEC registered investment adviser. PCS is not a licensed insurance agency or broker. Prudential LINK and LINK by Prudential occasionally may be referred to as LINK.
Insurance and/or annuities are issued by The Prudential Insurance Company of America, Pruco Life Insurance Company (except in NY and/or NJ), Pruco Life Insurance Company of New Jersey (in NY and/or NJ), and Prudential Annuities Life Assurance Corporation (PALAC). Each is a Prudential Financial company located in Newark, NJ (main office), except for PALAC which is located in Shelton, CT (main office), and each is solely responsible for its own financial condition and contractual obligations.
Variable annuities are distributed by Prudential Annuities Distributors, Inc., Shelton, CT.
Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company, Hartford, CT, or its affiliates .
This web page is being provided for informational or educational purposes only and does not take into account the investment objectives or financial situation of any client or prospective clients. The information is not intended as investment advice and is not a recommendation about managing or investing your retirement savings. Clients seeking information regarding their particular investment needs should contact a financial professional. Prudential Financial, its affiliates, and their financial professionals do not render tax or legal advice. Please consult with your tax and legal advisors regarding your personal circumstances.
This website is for U.S. persons only Opens in new window and may not be approved in all states. Information contained on this site does not and is not intended to constitute an advertisement, solicitation or offer for sale in any jurisdiction, outside the United States of America, where such use would be prohibited or otherwise regulated.
"Prudential Advisors" is a brand name of The Prudential Insurance Company of America and its subsidiaries.
Prudential, the Prudential logo, the Rock Symbol and Bring Your Challenges are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
Prudential Financial, Inc. of the United States is not affiliated with Prudential plc, which is headquartered in the United Kingdom.
Pruco Life Insurance Company, an Arizona company - California COA # 3637. The Prudential Insurance Company of America - California COA # 1179. Prudential Retirement Insurance and Annuity Company - California COA # 08003. The Prudential Life Insurance Company of America Newark, NJ.
Securities and Insurance Products:
Not Insured by FDIC or any Federal Government Agency | May Lose Value | Not a Deposit of or Guaranteed by the Bank or any Bank Affiliate.