Survey Identifies Financial Upsides Stemming From The Pandemic, But Stress Remains
The pandemic has been a bit of a mixed bag in terms of employment trends and outcomes it has generated over the past two years. John Hancock, in its latest Stress, Finances and Well-Being report, has identified one of those dichotomies, noting that this year's report showed participants' confidence in their personal financial situation is at its highest level since 2018 but a rising number—nearly 75 percent—report feeling stressed in the past year.
The report, detailing the results of a survey of John Hancock retirement plan participants, provides a snapshot of employees' feelings about their finances and well-being as they continue to manage the impact of a lingering pandemic. While their confidence in their financial situations and expectations for the future have risen, respondents also remarked that they're seeking help in making money management decisions and showing a desire for guidance and solutions.
“Uncertain economic times often cause people to adopt positive financial behaviors in the short term. This fact, combined with the unique situation of COVID-19 greatly reducing the opportunities to spend money, found many retirement savers in a stronger financial situation than they were pre-pandemic,” says Sue Reibel, CEO of John Hancock Retirement. “There’s a clear opportunity for employers to keep this momentum going by offering support to employees to help them make investment decisions with confidence, ultimately reducing their financial stress.”
Potentially reflecting participants confidence in their personal financial situations, the survey also found reduced levels of worry compared with last year's report. Representing a possible correlation with pandemic-related savings—lower commuting, entertainment, leisure and travel expenses—which has allowed respondents to put that money to work in other areas of their financial lives. However, the 2021 report found that three in four respondents exhibit financial stress at least at a moderate level. Financial stress continues to be prevalent at work as well, with 66 percent saying they worry about personal finances while on the clock, with nearly half responding that they worry about it on a weekly basis.
“The takeaway of this year's report is the paradox that we have actually seen improved savings and confidence in personal financial situations in an ongoing pandemic. However, the positive behaviors resulting in this trend have not been fully adopted by participants,” says Lynda Abend, head of strategy and transformation at John Hancock Retirement. “This environment presents a unique opportunity to help people bridge their short-term improvements into actions that will bring them sustainable, long-term financial health.”
The report also identified certain benefits and programs employers can offer to help mitigate employees’ financial stress. It found that 89 percent said it's important for employers to offer financial wellness programs, and 66 percent said that having access to financial wellness programs would make them more likely to stay with their employer. Additionally, roughly two-thirds of respondents expressed at least moderate interest in receiving recommendations on Social Security strategies and retirement income forecasts from their employers. And 93 percent said receiving projections on their estimated retirement income and expenses would help them save more.