Is
The weight of immediate financial concerns like debt and
Many cited the
"When almost all employees say they're stressed about finances, it's time for employers to listen — or risk it negatively impacting their company's bottom line," says Michael Bourgeois, vice president and business lead at SoFi. "HR leaders need to ensure employees understand the long-term tradeoffs and don't lose sight of future financial well-being. It's essential to offer a holistic benefits package designed to meet employees at all stages of life."
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While 76% of employees are committed to improving their immediate financial situation, that may come at the expense of their long-term financial well-being. For example, 30% are getting loans from family or friends as a solution to their short-term needs, while 23% have cashed out investments. Most concerning, one in five employees has
For many, their largest hindrance to financial independence is
Yet 90% of employees are hopeful their employer will help them with benefits like student loan repayment, or through participation in SECURE 2.0's new student loan matching program, which enables employers to make a contribution into an employee's retirement account, while the employee makes loan payments. Ninety-three percent of employers agree this benefit would further their retention efforts as well.
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"As of Jan. 1, companies are able to match student loan payments with 401(k) contributions, meaning employees who need to prioritize paying off student loan debt will still receive matching contributions to their retirement account," Bourgeois says. "This is a great way to support employees who need to pay off student loans while still ensuring future financial well-being."
Bringing money stress into the workplace
Financial stress takes more than just a toll on an employee's bank account. SoFi found that 48% of employees suffered from sleep issues related to their stress, while 47% said their financial issues had an impact on their mental health. Thirty-seven percent said it impacted their motivation at work, while 26% have even been forced to take on a second job to alleviate their financial struggles. SoFi found that employees spend around 14 hours per week dealing with their financial concerns.
"When you factor in the effects financial stress has on physical and emotional health too, it's clear most employees aren't able to bring their full potential or focus to work," Bourgeois says. "Employers must acknowledge how supporting employees' financial well-being gives them back the hours and mental bandwidth they normally spend stressing over money."
While two out of five HR leaders told SoFi they have seen the impact of financial stress on employee output and productivity, there's still a lack of clarity on what they should do about it. While 43% of employees want an emergency savings account benefit, half of employers do not offer this benefit, SoFi found. Meanwhile, 90% of employees are interested in SECURE 2.0 student loan matching benefits; 80% of employers do not have this benefit in place.
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Still, most employers do want to take action: 60% of employers said they hope to increase their budget around financial wellness benefits and education in 2024, according to SoFi. Leaders will need to do more to communicate the benefits they already have available — don't let employees get pulled under by their financial stress, especially when support is available, says Bourgeois.
"Focus on getting the right financial resources to the right employees at the right time," he says. "The reality is, employees aren't going to seek out or retain information about financial problems unless it becomes directly applicable in their lives. It's not up to HR leaders to help employees know everything — it's about making sure they have access to the necessary resources when it's time to make a decision."
