Impact of Low Financial Wellness on the Employee

Low levels of financial wellness have harmful impacts on employees. American employees are experiencing increasing amounts of stress associated with financial well-being. An annual online survey conducted by the American Psychological Association (APA, 2006) found that the two greatest concerns reported by respondents were money (59%) and work (59%). However, in 2008, stress associated with money rose to 81% and work to 67% (APA, 2008). Worse yet, in order to cope with the stress, many survey respondents reported engaging in behaviors that will make matters worse, including:

•        Drinking alcohol (18%).
•        Shopping (18%).
•        Smoking (16%).
•        Gambling (4%).
•        Being unable to do any activities at all (8%).

According to an April 2008 survey by the Kaiser Family Foundation, almost two-thirds (61%) of Americans report having “serious financial problems.” These problems included:

•        Paying for gas (44%).
•        Getting a good-paying job or raise (29%).
•        Paying for health care and health insurance (28%).
•        Paying rent or mortgage (19%).
•        Paying for food (18%).
•        Problems with credit card debt or other personal debt (18%).
•        Losing money in the stock market (16%).

A December 2008 survey of employee assistance providers (EAPs) conducted by the Employee Assistance Society of North America found a dramatic increase in requests for financial services from employees (up 88% since 2007) and for help with laid-off employees and downsizing (up 60%).

A majority of employees feel unprepared financially for economic strain, with less than a third of employees (29%) saying they had enough savings to cover more than six months of expenses, according to a 2008 survey by the Principal Financial Group of workers at companies with 10-10,000 employees.