Employees Report Stress over Financial Benefit Decisions
A significant problem is that workers seem unable to come up with strategies for facing rising out-of-pocket health care costs while maintaining their level of retirement saving. According to an Ameriprise press release, the study found that while 61% of respondents said reducing discretionary spending was a method used for dealing with rising benefit costs, almost half (46%) said they would decrease overall saving and investing.
More than 40% of workers reported an impact on their financial health and stress levels related to increases in their health care insurance costs and 44% said increasing benefit costs will impact their ability to fund retirement and other financial goals.
According to the study, less than one in five workers have a written, professionally prepared and paid-for financial plan, and those without a financial plan are more likely to cut back on their saving and investments in company-sponsored plans when confronted with increases in out-of-pocket benefit expenses. Of those employees facing one or more benefit cost increases, 54% of those without a financial plan said they would reduce their retirement savings level, compared with 46% of those with a financial plan, the release said.
Ameriprise found the employees surveyed would like their employer to provide financial planning assistance. Eighty-nine percent of respondents said a financial plan that directly addressed their workplace benefit costs and contingent financial decisions would be helpful, and 70% would be moderately or very interested in one-on-one financial planning if offered through their employer.
In addition, 87% of survey respondents expressed they believe a financial planning benefit would make them feel their employer recognizes and values their effort in the workplace.
For the research, a telephone study among 617 consumers was completed. Respondents included those with access to employer sponsored health insurance and enrollment in (or eligibility for a 401(k) plan.
A survey report is at http://www.plansponsor.com/uploadfiles/Ameriprisestudy2007.pdf .