Facts & Trends

Below are a series of 'eye-opening' facts and trends provided by leading research institutions around financial wellness and the impact of financial stress on employees and employers.

Financial Stress 'Early-Indicators' on the Rise

  • Human Resources departments are beginning to offer up statistics that further illuminates the situation. Recently, the Society for Human Resource Management reported that in the previous 12 months, survey respondents had seen:
    • 26% increase in employees having their wages garnished by collection agencie
    • 39% increase in requests for 401(k) plan loans; and
    • 20% increase in requests for pay advances
  • In Q2 2010, Fidelity saw a 37% increase in 401(k) hardship withdrawals compared to 2009 ("Understandign the Debt Difference" 2/2011, Jose Garcia and Jennifer Wheary)

Financial Stress and Employee Productivity Drain

  • 30% of U.S. employees are seriously financially distressed. On average, up to 80% of financially distressed employees spend time at work dealing with their personal financial issues, wasting anywhere from 12-20 work hours per month (Dr. E. Thomas Garman, President, Personal Finance Employee Education Foundation)
  • Up to 50% of employees admit to wasting 21 hours per month while on the job dealing with personal money matters. (National Institute of Personal Finance)
  • 5% of employees have their identity stolen each year and spend 50-120 hours remedying the issue.
    (    The “2010 Identity Fraud Survey Report" 2/2010 Javelin Strategy & Research)
  • MetLife 2010 Employee Benefits Trends Report:
    • 65% of employers say employees are less productive at work when worried about personal
      financial issues
    • 53% of employers who say absenteeism increases when employees are dealing with personal financial issues
    • 45% of employers and 46% of employees acknowledge that financial advice and guidance programs are effective at improving employee productivity.

Financial Stress is a Leading Cause of Rising Health Care Costs

  • Recent studies estimate that an employer's incremental health care cost of a financially distressed employee is $300 per year (MetLife, Study of Employee Benefits Trends, 1/2009)
  • Workers cite financial problems as their most frequent cause of stress and 75-90 percent of doctor visits are related to stress (American Institute of Stress, “Job Stress”)
  • 36% of employees say that 'stress' is the main reason that they do not maintain a more healthful lifestyle (OptumHealth Survey 2011)
  • Financial stress is a leading cause to illnesses such as migraines, back pain, anxiety, depression, insomnia, ulcers, weight gain and heart attacks (WebMD, “The Debt-Stress Connection,” August 2008)
  • According to a January 2009 survey by ComPsych (leading EAP firm), a staggering 92% of employees report losing sleep over money issues and 20% of the employee calls to their EAP call center stem from financial problems. Beyond insomnia, stress-related conditions such as migraine headaches, anxiety and depression also lead to hindered job performance and absenteeism.
  • The "Money Sickness Syndrome Report" from AXA July 2010 illustrates the deep impact financial wellness has on an employee's overall health and productivity:
    • High level managers blame the cost of living, bills and debt repayments for their worsening stress over the last year. As a result they tend to over eat (25%), feel anxious (23%) and feel permanently tired (17%)
    • Significant symptoms suffered overall include anxiety (41%), weight gain (25%), depression (23%), loss of concentration (22%), insomnia (21%) and loss of sense of humor/joy (16%)
    • Skilled manual workers and junior managers/administrative staff are the most likely to turn to drink (20% for both) or eat more (21% and 19% respectively) to cope with the financial stress.
  • More than four in ten (42%) say that in the past year, they or a family member have done at least one of the following because of they could not afford it: postponed getting needed health care (29%), skipped a recommended test or treatment (24%), not filled a prescription (23%), cut pills in half or skipped doses of a medicine (19%), or had problems getting mental health care (8%). Among those who report taking one of these actions, two-thirds (66%) say their medical condition got worse as a result. (Kaiser Family Foundation: Economic Problems Facing Families: Survey Brief from The Kaiser Health Tracking Survey)

 Financial Wellness Benefits in the Workplace

  • For employees earning less than $100,000 in income, Getting out of debt is their #1 financial goal
    (From Transamerica Harris Worker Report)
  • Employees regard financial stress as their primary concern, five times greater than personal health
    (National Institute of Personal Finance)
  • In 2007, for the first time since MetLife began running their annual benefits survey, over half of employee respondents indicated that they receive the majority of their financial and health products from their employer. This was also true in 2008. The study showed that 38% of employees were interested in receiving financial advice at work and 41% consider their workplace benefits to be the foundation of their financial safety net.
  • The Personal Financial Employee Education Foundation (PFEEF) has done numerous studies on the impact of Financial Wellness programs. As a general rule, PFEEF estimates employers can expect a minimum return of three dollars for every dollar invested.
  • Wellness investment accelerates in 2010 - A recent study by Fidelity and the NBGH revealed that employer spending on wellness programs grew 43% to $154/employee.

Financial Wellness Demographic Research - A Widespread Problem

  • MetLife 2010 Employee Benefits Trends Report:
    • Employees that make $75k or more/year: 48% say “Very concerned about having enough money to make ends meet” and 37% say they “live paycheck to paycheck”
    • Employees that make $40k-$75k/year: 57% say “Very concerned about having enough money to make ends meet” and 48% say they “live paycheck to paycheck”
    • Employees that make $40k or less/year: 76% say “Very concerned about having enough money to make ends meet” and 63% say they “live paycheck to paycheck”
  • 90% of the nearly 128 million workers in the US have difficulty managing their money and are not consistently saving for retirement. (National Institute of Personal Finance)
  • 66% of employees say "They have trouble paying their bills on time and worry about money".
    (National Institute of Personal Finance)
  • The "Money Sickness Syndrome Report" from AXA July 2010 reveals how widespread the financial problems in companies are today:
    • 57% of top managers are financially stressed
    • 64% of middle managers
    • 58% of skilled manual workers
    • Money stress has doubled since 2006
    • “Head-in-the-Sand Approach About Money” - 25% take no action to fix their financial problem
  • Negative financial events more than once in the past 12 months (National Institute of Personal Finance)
    • Paid late fee for paying a bill late: 72 %
    • Paid utility bill late: 53 %
    • Received overdue notice from creditor: 71%
    • Received phone call from creditor: 65%
    • Did not have enough money to pay for minor emergency: 32%
    • Reached max limit on credit card: 66%
    • Took cash advance on credit card: 35%

Identity Theft and the Impact on Employees

  • 5% of employees have their identity stolen each year and spend 50-120 hours remedying the issue.
    (The “2010 Identity Fraud Survey Report" Javelin Strategy & Research)
  • 1 in 3 victims don’t discover theft for over 12 months (Identity Theft Resource Center, The Aftermath Study, 2008)
  • ID Theft is the fastest growing crime in America (Federal Bureau of Investigation)
  • 11.1 million Americans victimized in 2009 (Javelin Strategy and Research, Identity Fraud Survey Report, 2010)
  • 83% of U.S. adults remain concerned about ID theft (Rasmussen Survey, December 2008)

 

   

 

 

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