Should You Consider Debt Benefits?—Slade
Monday, March 14, 2022
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Debt-related financial wellness benefits are relatively rare among employers. But if you don’t offer them, you might want to take a closer look.
Today’s Employees and Debt
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A recent study found that 63% of workers who work full-time at companies with 500 or more employees have unsecured debt in the form of credit card balances or medical or personal loans. During the pandemic, 42% of adults with credit card debt have increased their balance and 37% of employees say they have more debt than they can handle.
The impact of debt in the workplace
The impact of employees’ personal debt can extend to the workplace, affecting their performance and productivity. Of those surveyed, 40% have missed at least one day of work in the past 12 months due to debt stress. And 50% of people with debt spend an average of one hour a week at work dealing with debt issues.
When financial benefits are lacking
Many employers who offer financial wellness benefits focus on improving the future situation of workers, such as financial planning or preparing for retirement. But few meet their current needs. Payday advances, medical bill audits and negotiation, emergency loans and debt consolidation are examples of debt-related products available, but none of these have been offered to the majority of the respondents interviewed.
Sixty-five percent of employees feel stressed about their financial situation. And since employee debt is the main cause of their worries, it may be worth considering the benefits of debt management alongside more traditional offerings. Not only can these benefits help alleviate employee concerns, but they can also improve your company’s performance, culture, recruitment, and retention.
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Sam Slade is Managing Director, Benefits, at The Hilb Group of New England, where he provides consulting and brokerage services to local employers. He has extensive experience in all aspects of employee benefits, including underwriting, plan design, communications, compliance and analytics, with a particular focus on alternative funding and self-insurance. Sam lives in South Kingstown with his wife and three sons.