Gen Z students are entering the workforce with a lot of goals, especially where their personal finances are concerned.
In fact, our latest survey found that a whopping 77 percent of Gen Z employees say they have a clear set of financial goals and know how to achieve them. Their top goals include:
- Building savings/emergency funds
- Establishing a budget and sticking to it
- Tracking spending and changing habits
However, they’re still worried — 71 percent of employees surveyed say they’re moderately to very stressed about finances. And they expect employers to help. The majority of Gen Z employees (84 percent) say it’s important that employers offer financial wellness programs, according to our survey.
Here are the top obstacles you can help Gen Z employees address through your financial wellness program:
Balance Cost of Living
Cost of living continues to rise, and for younger employees who are just entering the workforce, this is often daunting.
This is causing more young professionals to move back home. In fact, a Trulia survey found nearly 40 percent of young adults lived with their parents, step-parents, grandparents and other relatives last year.
Tip: Help Gen Zers stop living paycheck to paycheck by teaching them how to budget. Connect them with financial analysts to help them balance their budgets so they can live comfortably. As an alternative, provide basic budget templates they can use on their own.
Address Student Loans
Student loan debt is a growing epidemic in the U.S. There is an estimated $1.48 trillion in total U.S. student loan debt, according to research from the Federal Reserve.
What’s more, research from Make Lemonade found that the average student in the Class of 2016 has $37,172 in loans. So, they’re entering the workforce with a lot of debt to pay off.
And employers aren’t helping — a January 2017 report from WorldatWork found that just 4 percent of employers provide loan-repayment benefits.
This mountain of debt fuels financial stress and hurts employee well-being.
Tip: Teach your staff about refinancing options. Show employees how companies like SoFi, CommonBond, LendKey, and Earnest can simplify their repayment process and save them on interest. To help alleviate their financial burden, provide student loan assistance benefits.
Build Emergency Funds
As a poll from the Associated Press-NORC Center for Public Affairs Research found, two-thirds of Americans would struggle to scrounge up $1,000 to cover an emergency.
This is especially difficult for Gen Zers, who don’t have the emergency funds they need.
Tip: Host a savings workshop to teach employees how to put away some of their paychecks for emergencies. Encourage them to automate their savings.
If they can’t afford to automate savings, create an overflow savings account. Whatever is left over every payday rolls into it. Those little contributions add up over time.
Establish Money Habits
As with every aspect of employee well-being, adopting good habits is vital. Here are habits Gen Zers should adopt and how to encourage them:
- Seek professional development. Provide employees with various learning opportunities. This can eventually lead to bigger paychecks.
- Start retirement planning now. Promote your retirement planning options and include incentives to those who sign up.
- Increase savings by small amounts each year. Encourage employees to add about 1 percent more to their retirement and savings annually.
- Track your spending. Show Gen Zers how to use budgeting tools like Mint to properly track where all their money goes.
Gen Zers want your help improving their financial wellness. And when you help them, they perform at their best.
How are you boosting employee well-being and supporting Gen Z with their financial wellness? Share in the comments!
Graham Shaw is the Head of Channel Sales, North America at LifeWorks, a company that delivers holistic and comprehensive well-being – physical, emotional, financial, professional & mental – through meaningful and purposeful technology and services. Follow LifeWorks on LinkedIn, Twitter, and Facebook.