Pension plans and life insurance contribute to employee financial security


Sixty percent of employees say their employer-sponsored pension plan contributes a lot to their sense of financial security, a 5% increase from 2020, according to the “2021 workplace wellness survey”, Conducted by the Employee Benefit Research Institute (EBRI) and the independent research firm Greenwald Research.

Of those with an employer-sponsored pension plan, seven in ten say they understand their benefits extremely or very well. Six in ten say they are satisfied with their plan. Of those who do not have an employer plan, 60% are interested in one.

Most of the employees surveyed currently contribute to their plan and receive contributions from their employer. Among those who receive employer contributions, 68% say they are satisfied with the contribution they receive. A little less than half say they contribute at the same level or up to their employer; another four in 10 contribute more.

About half also say that life insurance and financial wellness programs contribute a lot to their sense of financial security.

Employees say higher employer contributions (34%), increased flexibility (i.e. their benefit programs.

The 2021 survey of 2,016 U.S. workers was conducted online July 7-27. All respondents were between 21 and 64 years old.

Additional benefits to help with financial security

Although the majority of employees report feeling that the benefits offered by their employers help them feel more financially secure, 49% of employees express at least moderate concern about the financial well-being of their household. Saving for retirement and having savings for emergencies are the main sources of financial stress cited. Sixty-three percent say they feel stressed when thinking about their financial future, although that number is down from seven in 10 in 2020.

Two out of three employees surveyed say they have enough savings to deal with an emergency. Eight in 10 say they are prepared for an unexpected expense of $ 500 and six in 10 feel ready for an expense of $ 5,000.

Yet 83% of employees say they are at least somewhat interested in an emergency savings account that allows them to save through payroll deduction. And more than half (54%) of employees say their retirement savings are the only significant emergency savings they have.

Since the pandemic exposed the lack of emergency savings for many Americans, pension accountants have struggled to create solutions both in-plan and out-of-plan, according to a Commonwealth report. Participants’ financial well-being and emergency preparedness have also become more important in counselor service models.

When employees surveyed for the EBRI / Greenwald Research study were given a hypothetical monthly benefit budget of $ 600, they overall allocated the most money to a retirement savings account, followed by an emergency savings account. Although student loan debt is reported as a big problem and a barrier to saving, and some employers are considering ways to help employees with student loan debt, survey employees allocated the amount. the lower of the hypothetical monthly employee benefits budget to a payment plan. reduce student debt.

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