Millennial benefit woes: How clients can attract and retain younger workers
Millennials are nervous about the future of their employee benefits. Some are worried about retirement, healthcare and student loans, while others may feel their benefits are going to disappear entirely, according to new research from Prudential.
But as the largest generation in the workforce, if employers want to retain these workers long term, they need to adjust their benefits accordingly, the insurer says. Millennial benefits are also top of mind for advisers, who are constantly looking for ways to attract young workers.
Unsurprisingly, a top concern for millennials is the cost of education, Prudential found. Roughly 53% of millennial women and 44% of millennial men surveyed by the insurer say they are anxious about a world where the cost of school continues to increase.
“Many individuals struggle with, not the conversation about why should I participate in my 401(k) plan, but I’m buried in student loan debt,” said Harry Dalessio, head of full service solutions at Prudential Retirement, speaking at a media event in New York. “I don’t have $500 to fix my car if it breaks down. You have to start at the foundation of their needs.”
Dalessio suggests companies offer student loan assistance or emergency savings plans to help younger workers address immediate financial needs. Because millennials are so worried about paying down student debt, many neglect to save for retirement.
Roughly 79% of millennials think it’s likely people will no longer be able to comfortably retire in the future, which could cause them to be apathetic about saving in general, Prudential says.
“Many have that longevity disconnect,” Dalessio says. “[They] can’t see themselves in retirement, but have to deal with the present. So we see the platform emerging from a financial wellness perspective to include employers offering student loan assistance, to offering emergency savings to get at those core needs.”
Millennials are also nervous about rising healthcare costs. While most believe they will live longer lives due to medical advancements, some think the medical procedures they have today will be considered a luxury in the future, the company says. A majority (72%) of those surveyed are also worried that their employers will stop providing healthcare and retirement benefits altogether, Prudential found.
To attract younger workers, it may be very important for employers to make benefits packages front and center during recruiting efforts. The company also suggests offering benefits like HSAs, to help manage healthcare costs, and 401(k) matches and savings plans, to help employees take charge of their finances. It may also be valuable to leverage technology in the office that workers can access 24/7, Prudential says.
“Employers want to have a strong value proposition to retain the talent they have,” said Phil Waldeck, president and CEO of Prudential Retirement at the event. “I think there an alignment of interest in terms of the workplace being part of how we can make more impact.”