Financial Finesse Study Shows Employees Get Stuck – And How They Get Unstuck

Talking to a Financial Coach Reboots Financial Wellness and Narrows
Gender Gap

EL SEGUNDO, Calif.–(BUSINESS WIRE)–In a year marked by increased market volatility and slow economic
growth, it’s not a surprise that overall financial wellness levels
remained virtually unchanged. Employees appear stuck, hitting a brick
wall with debt, lack of emergency funds and inadequate retirement
savings. However, the latest study from Financial Finesse shows that the
way forward to improved employee financial wellness – and to narrow the
financial Gender Gap – could be human-to-human coaching, with technology
playing a supporting role.

The Year in Review: 2015, an analysis of employee financial trends based
on anonymous data collected by workplace financial wellness firm
Financial Finesse, describes a year where most employees have been
treading water in terms of their financial wellness. Overall financial
wellness levels were unchanged at 4.8 out of 10 vs. 4.7 in 2014.

The study shows that while technology was helpful in increasing employee
awareness of their financial vulnerabilities, online interactions alone
did not improve employee financial wellness. By contrast, employees who
had five interactions including conversations on the phone or in person
with a CERTIFIED FINANCIAL PLANNER™ professional showed substantial
progress. Those repeat interactions with a financial coach appear to
help an employee get “unstuck,” and advance in key areas. For these
regular participants:

  • 80% have a handle on cash flow, compared to 66% of online-only users
  • 72% have an emergency fund, compared to 50% of online-only users
  • 98% contribute to their retirement plan, compared to 89% of
    online-only users
  • 48% are on track for retirement, compared to 21% of online-only users
  • 64% are confident in their investment strategy, compared to 42% of
    online-only users

“Many employees are challenged in overcoming significant obstacles like
debt and managing competing financial priorities,” said Financial
Finesse founder and CEO Liz Davidson. “They make progress up to a
certain point, but it’s the interaction with the financial coach that
opens up possibilities and solutions and allows the employee to get
`unstuck.’ Technology can’t listen empathetically, brainstorm together,
motivate, offer options for dealing with their specific worries and hold
people accountable over time.”

Davidson noted that 71% of employees that repeatedly used their
financial wellness programs were women, and this has likely contributed
to narrowing the Gender Gap. A look at 31 key financial wellness
questions revealed the overall Gender Gap in Financial Wellness declined
from seven percentage points in 2014 to five percentage points in 2015.
The Gender Gap continues to be the largest in areas of investing and
money management, and smallest in areas of protecting the family, such
as insurance and estate planning.

For those employees who haven’t shown much momentum, 2015 data
illuminate many reasons overall employee financial wellness is neither
advancing nor declining. “American employees continue to have troubling
financial vulnerabilities,” explained Greg Ward, CFP®,
Director of the Financial Finesse Think Tank. “Eighty-five percent of
employees who completed a financial wellness assessment reported at
least some level of financial stress. Concerns about debt and retirement
are high. In fact, many employees first interact with workplace
financial wellness programs in hopes of getting a handle on their debt.”

Ward suggested employers who offer financial wellness programs consider
tailoring communications to address these vulnerabilities in particular:

  • 58% may not be saving enough for retirement, with only 16% of
    Millennials on track to achieve their retirement goals.
  • 51% don’t have an emergency fund. While this declines with age, a
    worrisome 25% of employees 65 and older still don’t have an emergency
  • 34% may be living beyond their means. For employees with family
    incomes of $100,000 or lower, less than half pay off their credit
    cards every month.
  • 33% may have serious debt problems. Debt may be hurting African
    American and Latino employees the most, with 75% of African American
    and 66% of Latino employees saying getting out of debt is a top
  • Concern over market volatility is high. Many employees grew nervous
    about their retirement plan savings and turned to their financial
    wellness program for guidance on how to handle these market

Davidson said overall, companies providing financial wellness programs
continue to see a reduction in the percentage of employees who reported
having taken a retirement plan loan or hardship withdrawal, coming in at
23% in 2015, down from 30% in 2013. As more employers adopt robust
financial wellness programs, she expects these improvements to continue.

About Financial Finesse

Financial Finesse provides unbiased financial guidance and education to
employees through their employers, delivered as comprehensive financial
wellness programs. Its education is proven to move the needle in
employees’ financial security and provides a clear return on investment
for their employers in productivity, absenteeism, health care costs and
more. All programs are customized and holistic, delivered by CERTIFIED
FINANCIAL PLANNER™ professionals who do not sell any financial products
or manage assets. Its multi-channel education approach offers a variety
of channels such as live workshops, webinars, one-on-one financial
counseling sessions and a financial helpline—reaching over 2.4 million
employees at over 600 companies.


Financial Finesse
Maneeza Hasan
o: 424 218

c: 818 470 9541