Can employees feel
They can — with the help of supportive
"It's such an interesting moment in time, given the three things we're hearing about almost every day:
Despite the differences in each worker's experience, stress may be an increasingly universal trait: 41% of employees are currently living paycheck-to-paycheck, according to
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For employers, that's an opportunity: as the
Uranker spoke to EBN about the challenges employers and employees are facing as the economy continues to shake, and outlines thoughtful ways organizations can lend support without breaking their budget.
The world of financial benefits and wellness seems to constantly be expanding. What are some of the trending benefits and programs employees are really craving?
Funds that employees can use at their discretion for everything from gym memberships to child care — that flexibility allows people to solve for whatever need they might have in a particular moment.
For employers, remaining competitive is about making sure that adoption, surrogacy and family-building benefits are at or above market, as employees are certainly asking those questions. A competitive 401(k) match will never go out of style, even if it's something that's talked about less. And I still think organizations can use their size and leverage to get preferred access or preferred pricing — maybe that's a high-yield savings account, maybe it's mortgage refinancing. Giving folks access at preferred terms is quite interesting to employees.
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How much are those kinds of programs on an employer's radar, or is that an area where they are looking to advisers and vendors to guide them to those offerings?
Those voluntary benefits where employers use their size to get preferred pricing, they've been around a long time, but I don't think employees know how to find them or know that they exist. So employers need to either choose to re-communicate it, or be more upfront in terms of where they are and how to access them, or work with a financial wellbeing partner to integrate it into planning conversations.
As for the lifestyle spending accounts, we've seen a handful of companies implement it already, but we're really starting to see the discussion and conversation around how to create these lifestyle accounts, and where that budget comes from as we head into 2023, given the economic environment.
What are you hearing from employers as they attempt to navigate this economy?
Over the summer there hadn't been a ton of concern, but I do feel that changing as we head into the fall. We're starting to hear employers ask, how can we provide value in employee benefits without committing large dollar amounts?
One way we're seeing companies get creative and create more flexibility and choice is around paid time off. So many companies offer generous PTO, and they're allowing folks to convert that PTO into things like payments against student loans, maybe additional contributions toward the 401(k) or even something as creative as charitable giving.
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For these benefits that are a little more creative and maybe haven't been as proven on the market, how are employers trying to measure the success and ROI?
We continue to see the rise in employee surveys. It's something that's always been done, but the number of organizations conducting these pulse surveys has increased. HR leadership teams are really keen on keeping a close eye on where they're adding value and how employees are using these benefits. And organizations are also leaning more on their vendor partners to help with the data story.
For example, we have a financial wellness assessment here at Goldman Sachs Ayco, and we're able to share that aggregated data back to an employer to say, Hey, here's how people are feeling about particular areas of their financial life. You can compare it to data from a year ago, and we can also compare it against our book of business, to see how an organization stacks up against the other companies we work with.
How do you help employers understand the nuances of a diverse workforce and find ways to serve an employee base with a variety of needs?
We want to ensure that we can match and mirror the financial needs and sophistication levels of a large, dynamic workforce. So rather than come in with one particular service on the financial planning or wellness side, we look to offer tiers of different services, and recognize that everyone's not coming into the conversation at the same point. Folks that have just onboarded may have different questions about their benefits than someone who has been at an organization for decades.
When you talk about the vast needs of a workforce, it often creates a conversation around diversity and inclusion. And we've spent a lot of time putting a lens on the financial planning, education and guidance that we give, recognizing things like, for example, women's life expectancy is longer than men's. How does that impact how you think about asset allocation and investing? Another example is how a decision around life insurance might look way different for someone who's in the transgender community. We keep that in mind in the guidance and education we give as a partner.
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What are you hearing from employees in terms of economic uncertainty?
There's one particular group that's really caught between those three items of inflation, market volatility and rising interest rates, and that's folks who are somewhere near retirement. We're really talking about how they can think about the decumulation of everything they've accumulated through the years. The biggest question is, how do I spend the money down in the absence of a regular paycheck?
For younger generations, one of their biggest struggles is student debt. How impactful will President Joe Biden's loan forgiveness be on financial wellness?
The question is, how do you help people potentially divert those extra dollars into either repaying the rest of their debt more quickly, maybe paying down credit card debt, or hopefully down the line, increasing contributions to a 401(k), contributing to an HSA or even an emergency savings fund.
For folks still staring down a big pile of loans, what's the best approach to paying that down?
The snowball effect is the most common path to repayment. It's about looking at your loans and saying, where are the smallest balances that I can just knock out? And with that progress, you gain a little confidence, and you can roll that loan payment into your next highest-balance loan.
The other piece is really understanding what your debt is costing you. Your highest interest-rate debt is costing the most money, and that's oftentimes credit card debt, followed by student loan debt. And in a time of rising interest rates, that becomes even more critical. So understanding that debt and figuring out how to allocate any extra dollars toward that high-interest debt will put someone in a better financial place, more quickly.
