Employers are embracing the concept of financial wellness, with 81% of HR professionals saying they believe they are at least somewhat responsible for their employees financial wellness, according to a survey released this week by Bank of America Merrill Lynch.
Seventy percent of the 1,000 companies surveyed offer various forms of education related to retirement and, to a lesser extent, planning for health care costs (38%), as well as debt management and budgeting (15%).
And while employers say theyre interested in the concepts of financial wellness and retirement readiness, their actions may have some catching up to do. Less than half of large companies (48%) has a financial wellness strategy in place for employees or plan to add one in the next two years. Among medium-sized companies, the percentage drops to 43%. Among small companies, 26% have a financial wellness strategy in place or plan to add one in the next two years.
It will be interesting to see how quickly do they then adopt practical, tangible programs to realize their aspirations of what they want to do with their employees, says Kevin Crain, senior relationship executive for Bank of America Merrill Lynch. Its still early stage in their thinking.
Perhaps not surprisingly given all the attention the Affordable Care Act is receiving, one-third (32%) of HR professionals say theyve increased the time they spend educating employees about the role workplace benefits play in their financial security.
One area many employers agree needs greater focus and employee education is the rising cost of health care. Eighty-one percent of companies report an increase in health care costs during the last two years, and many admit to having had to pass these rising costs along to their employees. The study found that more than one-third (35%) of employers now provide employees with education about what health care could cost them during retirement, up from 21% in 2012. Among employers who provide at least some education about retiree health care costs, nearly half (45%) believe more needs to be done in this area.
Employers now understand their employees need far more transparent and easier ways to understand what the cost of health care will be in the future, says Crain. The health care expense piece [of retirement] was always, in my mind, not as robust as it could have been. With all the attention on the ACA, health care costs in retirement is an issue thats been brought to the forefront, he says.
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