Employer Financial Wellness Programs May Help with Stress and
Retention
TSX/NYSE/PSE: MFC SEHK: 945
BOSTON, Oct. 22, 2019 /PRNewswire/ - John Hancock
Retirement today announced the results of its sixth annual
Financial Stress Survey of retirement plan participants, revealing
the weight of financial stress on workers and its impact on
employers. The survey reports that more than half of respondents
worry about personal finances at work at least once a week, causing
workplace distraction and loss of productivity. This loss of
productivity combined with absenteeism from financial stress has
major impact on organizations, costing more than an estimated
$1,900 per year, per employee, and
totaling an estimated annual loss of $1
million for midsized employers and $19 million for large employers.1
The survey did find that employer financial wellness programs
may improve job retention, stress levels and job productivity.
Seventy-seven percent of respondents find financial wellness
programs important and seven in ten feel these programs have helped
reduce their financial stress and increased their loyalty to their
employer. While 88% of employers say they currently have or are
developing a financial well-being strategy, only 20% of
participants claim their employer offers anything more than a
limited financial wellness program.2
"Our 2019 Financial Stress Survey highlights a downward trend on
retirement readiness and indicates participants' financial
situations are at risk, with 36% of participants responding they
are not in a good financial situation," said Patrick Murphy, CEO, John Hancock Retirement.
"Seventy-one percent of participants are worried about having
financial difficulties – the most we have seen from this survey in
the past six years. We must come together as recordkeepers,
financial representatives, and plan sponsors to help participants
plan for their future and better understand the underlying cause of
financial stress and its effect on retirement savings."
Year over year, the number one financial worry is saving for
retirement, except for those with student loan debt. Higher than in
previous years, as much as 51% of workers consider themselves
behind schedule when it comes to saving for retirement. Lack of
emergency savings is the number two financial worry among all
participants, and 25% have no emergency savings at all, which is
even more pronounced for Generations X, Y, and Z where almost a
third are in that position. The survey also found that fewer people
are taking action to help their financial situation, with only
about one of four respondents having met with a financial advisor,
contributed to an IRA or allocated to a health savings account.
John Hancock's 2019 Financial
Stress Survey highlighted the following:
- Concerns about personal finance affects workplace
productivity: Forty-nine percent of respondents feel they would
be at least somewhat more productive at work if they did not worry
about finances while at their jobs – up from 43% last year. This is
disproportionately impacting the younger workforce; Millennials
(22%) and Gen Xers (18%) are more likely than older generations
(11%) to say they would be much more productive without financial
worries.
- Confidence decreases in ability to make financial
decisions: Only 18% of respondents feel very confident in their
ability to make the right financial decisions, showing a decrease
over the past three years. Only about one-third consider themselves
very knowledgeable about basic financial concepts, such as managing
debt (33%) and budgeting (31%). This is a disadvantage for the
progress of retirement saving. Fifty-seven percent of respondents
agree they would do more to save for retirement if they had more
knowledge on how to prioritize their financial challenges.
- Increase in retirement contributions: Forty-eight
percent of participants have increased contributions over the past
two years. However, there is still uncertainty when it comes to
knowing how much will be needed in retirement and a gap between
what they think they should be saving and what is actually being
put away. More concerning is that 10% aren't saving anything at all
and 25% are only saving between 1% and 5%.
Mr. Murphy added, "We recognize the potential impact that
working with a financial representative and participating in a
workplace financial wellness program may have on a participant's
ability to contribute more significantly to savings and stay on
track for retirement. We have also identified the critical areas
where participants need help planning for retirement, and are
committed to bringing personalized programs to market, that help
them tackle the key components of financial stress."
Tools for financial success
John Hancock Retirement
has recently enhanced its participant financial education content
and tools via a new online learning management system - My Learning
Center. This system tracks and rewards participant's interaction
and serves up key content on the platform's homepage to help plan
participants improve their financial literacy, assess their
personal finances, and work toward retirement readiness at all life
stages. Through this offering, plan participants can view
their financial lives holistically and then opt into individualized
goal–based action items to increase financial literacy and
proactively work towards financial wellness. Plan sponsors then use
the enhanced data coming from these resources to inform targeted
employee education campaigns to help improve outcomes.
To see the 2019 John Hancock Financial Stress Survey white paper
or learn more about John Hancock Retirement, please click here or
visit https://retirement.johnhancock.com/us/en.
Methodology
The 2019 John Hancock Financial Stress
survey was commissioned by John
Hancock and conducted by Greenwald & Associates. An
online survey of 3,547 John Hancock
plan participants was conducted in June
2019.
About John Hancock Retirement
As of June 30, 2019, John
Hancock serviced over 60,000 plans with over 2.8 million
participants and over $170 billion in
AUMA*
* As of June 30, 2019, John
Hancock Life Insurance Company (USA) supported 46,547plans, 1,605,076
participants, and $88,464,393,180 in
AUMA. John Hancock Life Insurance Company of New York supported 2,527 plans, 75,000
participants, and $5,165,273,862 in
AUMA. John Hancock Retirement Plan Services, LLC supported 11,058
plans, 1,207,998 participants, and $77,201,601,108 in AUMA. Participant Counts
reflect all active participants with a balance. Approximate
unaudited figures for John Hancock,
provided on a U.S. statutory basis.
About John Hancock and
Manulife
John Hancock is a
unit of Manulife Financial Corporation, a leading
international financial services group that helps people make their
decisions easier and lives better. We operate primarily as
John Hancock in the United States and Manulife elsewhere. We
provide financial advice, insurance and wealth and asset management
solutions for individuals, groups and institutions. Assets
under management and administration by Manulife and its
subsidiaries were over CAD $1.1
trillion (US$877 billion) as
of June 30, 2019. Manulife Financial
Corporation trades as MFC on the TSX, NYSE, and PSE, and under 945
on the SEHK. Additional information about Manulife can be found at
manulife.com.
One of the largest life insurers in the United States, John Hancock supports approximately
10 million Americans with a broad range of financial products,
including life insurance, annuities, investments, 401(k) plans and
college savings plans. Additional information about John Hancock may be found at
johnhancock.com.
About Manulife Investment Management
Manulife
Investment Management is the global wealth and asset management
segment of Manulife Financial Corporation. We draw on more than 150
years of financial stewardship to partner with clients across our
institutional, retail, and retirement businesses globally. Our
specialist approach to money management includes the highly
differentiated strategies of our fixed-income, specialized equity,
multi-asset solutions, and private markets teams—along with access
to specialized, unaffiliated asset managers from around the world
through our multimanager model. Our personalized, data-driven
approach to retirement is focused on delivering financial wellness
in retirement plans of all sizes to help plan participants and
members retire with dignity.
Headquartered in Toronto, we
operate as Manulife Investment Management throughout the world,
with the exception of the United
States, where the retail and retirement businesses operate
as John Hancock Investment Management and John Hancock, respectively; and in Asia and Canada, where the retirement business operates
as Manulife. Manulife Investment Management had C$844 billion (USD $645
billion) in assets under management and administration as of
June 30, 20193. Not all
offerings available in all jurisdictions. For additional
information, please visit our website at
manulifeinvestmentmgt.com.
- This is a hypothetical illustration used for informational
purposes only, based on data from John
Hancock's 2019 Financial Stress Survey. The example assumes
3.2 hours of work missed per year and 43.95 hours in lost
productivity due to financial stress. Average wages used in the
calculation are based on 7/31/2019
John Hancock participant data. The
John Hancock Financial Stress Calculator is intended to
provide general information about how much financial stress can
cost a company every year. Individual circumstances may vary and
there is no guarantee that the results shown will be achieved, and
the assumptions provided may not be reflective of personal
situations.
- "Hot Topics in Retirement and Financial Wellbeing," Alight,
2019,
https://ideas.alight.com/wealth/hot-topics-highlights-financial-wellbeing.
- MFC financials. Global Wealth and Asset Management AUMA as of
June 30, 2019 was C$844 billion and includes C$191 billion of assets managed on behalf of
other segments and C$136 billion of
assets under administration.
John Hancock Retirement Plan Services, Boston, MA 02116.
NOT FDIC INSURED. MAY LOSE VALUE. NOT BANK GUARANTEED.
© 2019 All rights reserved.
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SOURCE John Hancock Retirement