3 Ways To Help Younger Employees Cope With Money Worries

Recent data has revealed younger employees are more likely to be stressed about their finances compared to older generations. A study from the American Psychological Association found over 60% of Gen Z and Millennials feel overwhelmed by their financial woes, compared to 13% of Americans 65 and older.

A Georgetown and Bank of America study found that, due to a lack of financial security, most Gen Z and Millennial employees (64%) don’t expect to retire at 65. More than 40% of these individuals also hold outstanding student loans or other consumer debt that may cause them to delay or even skip important milestones.

Today, total debt from borrowers under 40 years old is more than 800 billion, per the Education Data Initiative. In fact, according to the Federal Reserve Bank of New York, the increase in missed payments from credit card delinquencies has been driven by Gen Z and Millennial employees.

Organizations must take intentional steps to understand the financial challenges facing younger employees and then choose solutions with tangible results. These three strategies may be the key to getting started:

1. Provide resources for debt management.
Debt management is a highly sought-after benefit among all employees, but younger people particularly prioritize debt management in the workplace.

Nearly 20% of younger employees say they’d like their employer to offer debt management benefits, according to a Georgetown University and Bank of America study. Debt management tools allow younger employees to access personalized support, no matter their financial situation. They may also be critical in helping younger employees to reach life milestones such as buying a first home or beginning a family.

2. Focus on customizable financial guidance.
Personalized financial coaching is one of the most powerful resources for reaching younger employees. Because every person’s situation is different, generic financial advice does not generally move the needle for the average person. Instead, consider implementing benefits that offer guidance tailored to specific financial goals and milestones.

Personalization also provides the opportunity for more direct and impactful financial coaching. Younger employees with outstanding debt say they’d rather pay off their consumer or student debt than invest for retirement. Without dedicated feedback, inexperienced employees can make critical errors that delay important financial milestones. Alongside a money coach, younger employees can develop a strategic plan to pay off their debt, while preparing for retirement.

3. Prioritize transparency in your benefits program.
As younger employees use online resources and applications for managing their finances, clarity becomes increasingly necessary.

Benefits can be incredibly complicated, no matter who wants to access them. Along with the expense, employees can be overwhelmed by the available options. In fact, according to the same Georgetown study, 49% of young adults wish they had a better understanding of the benefits offered by their company.

Given younger employees are often more technologically literate than older peers, it’s helpful to take a digital-first approach to financial wellness. Younger employees are more likely to engage with benefits that are explained well and often, especially if they can be accessed through their smart devices or digital channels.

How U.S. Legal Services and Best Money Moves Can Help
Are you looking for a financial solution to support the younger members of your team? U.S. Legal Services has partnered with Best Money Moves, a financial wellness platform, to offer accessible, award-winning financial education.

Best Money Moves works with our legal plans to help employees make smarter decisions about managing their money. With interactive, user-friendly tools and a digital-first platform, Best Money Moves offers resources to meet younger employees wherever they may be in their financial lives. Plus, because the program is entirely customizable, there’s something for every employee — regardless of age or financial background.

To learn more about how group legal insurance benefits and financial wellness can support your team, contact us online or call 1.800.356.LAWS or visit www.uslegalservices.net for a quote.