Most employees feel good about their retirement savings, but rising day-to-day expenses can create enough stress to affect workplace productivity. To attract and retain top talent, employers should consider these financial challenges when updating benefits for 2025.
Anxiety Rises Over Living Expenses
Despite its recent cooling, inflation’s impact on the cost of living is the top stressor. Additional leading worries include credit card debt, housing, and medical bills.
To cover emergency expenses, 54% of employees are dipping into their retirement savings. This problem is worsened by the lack of emergency funds—only 25% of financially unstable employees have them, compared to 82% of those who are financially stable.
There’s also a contrast between retirement confidence and readiness. While 72% feel somewhat optimistic about retiring, just 38% expect to have the $500,000 in savings that 56% believe they need. Additionally, retirement savings goal estimates vary wildly, with 21% thinking they need less than $100,000 to retire. Employees need more financial education and tools to meet near- and long-term money targets.
Money Worries Hurt Mental Health, Work Performance
Finances cause moderate to significant anxiety for 62%, up since 2023. This takes a toll at work – 51% say money stress makes it difficult to focus and perform. Nearly 1 in 5 say it impacts their work ability “all the time,” signaling an urgent issue for employers to address.
Demand Rises for Financial Benefits
With current financial realities, employers must prioritize financial wellness benefits that provide holistic support. The top desired offerings are:
- 401(k) benefits: 40% seek access to retirement plans. Of those with this benefit, 55% want higher employer matches.
- Emergency savings: 40% want employer-sponsored emergency funds.
- Wellness and financial aid: 33% seek wellness stipends, 29% want FSAs or HSAs amid rising living costs.
- Tools and advice: 24% want budgeting tools and 21% seek access to financial advisors.
- Education benefits: 18% want student loan assistance/repayment. Another 18% like 401(k) match programs that also make student loan payments.
Workers aren’t viewing these lightly – they’re willing to leave for companies that provide such offerings.
For more ways to attract top talent in 2025, or additional Employee Benefits resouces, contact INSURICA today.
Copyright © 2025 Smarts Publishing. This is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.
About the Author
Share This Story
Related Blogs
Flexible Compensation: A Necessary Evolution
In today’s fast-evolving job market, flexible compensation is redefining how companies attract and retain talent. Traditional pay structures, once seen as stable and predictable, are now losing appeal, particularly among younger professionals who prioritize personalized benefits over rigid salary scales. While flexible compensation models have gradually emerged since the early 2000s, the post-pandemic work era has rapidly accelerated their adoption—driven by shifting workforce expectations, economic volatility, and the rise of remote work and gig employment.
Balancing Employee Wellbeing and Financial Pressures
In today’s economic climate, businesses are facing rising costs and inflationary pressures, leading to a fundamental reassessment of employee benefits programs. While mental health and wellbeing initiatives remain a priority for employers, there is a growing demand for measurable impact and cost-efficient solutions rather than superficial perks. As companies strive to balance budget constraints with competitive benefits, the future of workplace wellness is shifting toward strategic, high-value programs that support employee health without breaking financial sustainability.
How Businesses Are Using Data Analytics to Optimize Employee Benefits Engagement
In today’s competitive job market, businesses are increasingly leveraging data analytics to enhance employee benefits engagement, ensuring that workers fully utilize available resources. Traditional benefits programs often suffer from low participation rates due to lack of awareness, complexity, or misalignment with employee needs. By integrating data-driven insights, companies can personalize benefits offerings, improve communication strategies, and maximize employee satisfaction while optimizing costs.