Article

Employees Seek Financial Fitness

mug of coffee next to some quarters and a napkin doodle of personal financial planning
By Michael Conte

5 minutes

Credit union employees want more help with financial management skills.

As employers and financial services providers, credit union leaders today can see firsthand that simply explaining to people how to optimize their 401(k) plan rarely moves the needle on how much they’re saving for retirement. Recent surveys show one big reason for this: An increasing number of consumers aren’t making ends meet. 

Our industry can help reverse this trend—starting with our own employees. In addition to your retirement planning tools, it’s worthwhile to provide easy-to-use, personalized and motivational programs that help your employees achieve basic financial fitness. 

To clarify: “Financial fitness” (a.k.a. “financial wellness” or “financial well-being”) goes beyond retirement planning. It means managing your finances so you routinely spend within your means, hold debt in check, keep enough liquid funds on hand for emergencies and generally live with minimal stress over money.

Financial Distress Increases in 2019

Having financially fit employees who are less stressed, less distracted and more likely to retire on time has tangible benefits for employers. For example, the average cost to an employer for each year an employee delays retirement is $50,000, according to a study from Prudential Finance. This is based on the cost of an entry-level employee less the cost of the retired person, considering that if that person had retired, other employees would have moved up a notch. 

 But the end zone for financial fitness appears to be moving farther away from more American workers in 2019. Consider these 2019 results from PricewaterhouseCoopers’ 8th Annual Employee Financial Wellness Survey:

  • 49% of employees surveyed said they find it difficult to meet their monthly household expenses, up from 37% last year and 33% five years ago.
  • 67% found it stressful to deal with their financial situation—a huge jump from 47% last year and 45% five years ago.

Perhaps the most alarming aspect of these results is that they come during a relatively strong economy with low unemployment. A serious economic downturn in the communities your credit union serves may not cost your employees their jobs, but it would likely hurt many of their households. Offering your employees financial fitness tools now could make a critical difference in how well they and their families weather the next economic storm.

Offering your employees financial fitness tools now could make a critical difference in how well they and their families weather the next economic storm.
Michael Conte
Director of Retirement Solutions
CUNA Mutual Retirement Solutions

Survey: Employees Ask for Financial Wellness Help

CUNA Mutual Retirement Services surveyed 9,200 retirement plan participants in 2018, asking which retirement and finance planning topics interested them most. Among millennials (ages 18 to 34), the top answer was “budgeting and managing debt.” That was tied for the top answer among mid-career employees (35 to 49) with “understanding tools and resources available.” Respondents 50 and older ranked “preparing to transition to retirement” as their top topic, followed by “understanding tools and resources.”

Given these survey results, it’s not surprising which topics CU employees have been choosing most often in a limited-scale financial fitness program run by Financial Fitness Group, in conjunction with a CUNA Mutual Retirement Solutions 401(k) website.

The top three picks for early career users are:

  1. building a budget,
  2. managing your debt, and
  3. living within your means.

The top three picks for mid-career users are:

  1. managing your debt,
  2. building a budget, and
  3. building an emergency fund.

Finally, the top three picks for older users are:

  1. Social Security, Medicare and retirement,
  2. living within your means, and
  3. determining retirement needs.

This program is in its early stages, but it’s clear that CU employees have an appetite for basic financial management education.

Financial Wellness Program Best Practices

If your credit union is considering a financial fitness program for employees, look for these four elements that engage employees beyond simply making reading materials available.

  1. Ease of use: Program providers should be able to take you through a test run so you can see whether the online interface and features are intuitive, easy and maybe even fun to use. The content must feature professional-quality writing and production; nobody will stick around long if they must wade through boring, long-winded articles or videos.
  2. Individual benchmarking: Employees should begin your program with some type of self-assessment that they can use to benchmark current strengths and weaknesses, so they can track their progress.
  3. Broad-based and personalized content: Program participants should be able to choose from topics that pertain to their personal life stages and financial situations. Also, offer options for how to consume the content, such as articles, email tips, videos and even one-on-one support with experts.
  4. Motivate and reward: It sounds simple, but something as basic as watching point totals increase each time users complete a piece of a program can help motivate them to keep learning.

Include quizzes to reinforce key points and show progress. Also, consider offering tangible rewards to employees for completing part or all your program. It could be a free lunch or a branch-by-branch contest with bigger prizes.

These principles for financial fitness programs apply to any industry. But they’re especially important in credit unions, where the mission is to serve members’ best financial interests. Serving these interests for our employees can make them better resources for members and better advocates for the credit union’s products and services.   

Retirement Savings Crisis For Young & Old Alike

Overall, more than 45% of Americans surveyed by GOBankingRates have saved nothing for retirement, and nearly 19% more have saved less than $10,000. Of course, the youngest survey respondents, aged 18-34, are pulling up those percentages considerably. However, retirement savings are clearly inadequate for many older Americans, too:

  • Older Millennials and Gen X: 42.5% of respondents aged 35-44 and 45.2% of those 45-54 have saved nothing for retirement. Only 14.5% and 12.6% of those age groups, respectively, have saved $10,000-$49,999 for retirement. How long would $50,000 last a typical American in retirement? One year, maybe?
  • Baby Boomers: More Americans in the two older age groups surveyed had zero saved for retirement than Americans who had at least $50,000 saved. Of respondents aged 55 to 64, 39.1% had nothing saved and 31.7% had $50,000 or more. For those 64 and older, 33.3% had nothing saved and 33.1 had $50,000 or more.  cues icon


Michael Conte is the director of retirement solutions for CUESolutions Platinum provider CUNA Mutual Retirement Solutions, Madison, Wisconsin. Reach him at michael.conte@cunamutual.com. For more information about becoming a CUESolutions provider, please email kari@cues.org.

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