This trend appears to cut across all age, ethnicities and income brackets. While more than half (57%) of workers with children under 18 said they rely on their paycheck to manage finances, even among employees earning $75,000 or more a year, more than 34% are relying on their paychecks to get by, according a release of data from MetLife’s 2003 Employee Benefits Trend Study reported by Dow Jones.
Contributing to this dependency of pay periods are a weak economy and escalating health-care costs, which has led individuals to see the value of their own assets decline, said Craig Guiffre , vice president of national accounts at MetLife. And although overall inflation has been low, certain costs are rising, such as medical care and college tuition. Meanwhile, employers have been shifting more of the costs of benefits to employees, he said.
To help stem the tide of the paycheck dependent, Guiffre recommends putting together a financial plan, which 71% of the survey either do not have, or do not know if they have.
“The good news is that even for folks who are living paycheck to paycheck, it doesn’t have to be expensive” to put together a financial plan, Guiffre told Dow Jones. In fact, Guiffre says open enrollment season is an ideal time for employees to ask about a financial plan, even though nearly two-thirds of those polled said they spend less than an hour each year considering their household’s financial needs during their company’s open enrollment for employee benefits.