Those of us who grew up in the 60s and 70s tend to think of employee benefits exclusively in the realm of health insurance and retirement plans, and maybe dental and vision. But it is not the same for younger workers. Millennials in particular are asking for other things. Financial education benefits come to mind.
Financial education falls under the broader financial wellness benefits category, according to Dallas-based BenefitMall. The brokerage general agency says that such benefits are an emerging trend among employers across all industries. General agencies are even encouraging their brokers to include financial wellness benefits in their non-medical options.
In terms of financial education specifically, younger workers find themselves unable to get a handle on their finances. They struggle to pay their bills. They struggle to save. Many are struggling to buy that first home. They want help, and they have the expectation that people capable of building a successful business are well suited to teach them.
Millennials Are Familiar With Recession
The Benefits Pro website pointed out in a recent post that the millennial generation is familiar with recession. A fair number of them first entered the workforce during one of the worst recessions in U.S. history. They were already at a disadvantage coming out of college and landing that first job.
Unfortunately, sound money management skills seem to fall by the wayside during tough economic times. Parents struggling to make ends meet are not necessarily eager to teach their kids how to manage money. That is exactly what so many millennials experienced as they entered adulthood. They were never taught basic financial skills. Now it is coming back to bite them.
Younger Workers Are Facing a First Recession
Younger workers, namely Gen Zers, have only been on the workforce a few years or are just entering it now. They were just kids when the last recession hit. For all practical purposes, they know nothing of it. But they are facing another recession that could be equally bad, or worse. Are they going to know how to weather the financial storm?
Like millennials, Gen Z hasn’t gotten a lot of help in learning basic financial skills. They have grown up on technology to the extent that they know how to use mobile payment platforms, banking apps, and a wide range of tools for moving money about. But many of them do not know basic financial principles like budgeting and saving.
Student Debt Doesn’t Help
Adding insult to injury is the heavy weight of student debt so many younger workers face. It is not uncommon to graduate with tens of thousands of dollars in outstanding debt hanging over one’s head. For someone who already struggles with basic financials skills, such a large amount of debt can be overwhelming.
It all adds up to a tenuous situation as workers face the possibility of bleak economic conditions for the next several years. Even if all the right decisions were made to fix the economy today, it would take a long time to climb out of the hole we have dug for ourselves. Younger workers who don’t know how to manage their finances are destined to struggle the most.
All of this represents an opportunity for brokers and employers to come up with a range of benefits aimed at educating their employees. Budgeting classes would be a good start. Employers could offer access to debt counseling, financial planning, and other similar services.
The important thing to understand is that younger workers are asking for help. They want financial education benefits because they don’t know how to manage their money.