Forget the salad bar and ping-pong table at the office — workers want substantial benefits, and in some cases, they may already have them.
Retirement Tip of the Week: As we head into the new year, review what benefits your company already offers and take advantage of these offerings as much as you can. Don’t see something you wish you had? Consider asking your employer for it.
Salary isn’t the only thing that workers should consider when it comes to compensation, benefits can be very important, especially when pertaining to health insurance and retirement plans. But employees want more — many wish for options that promote financial wellness, such as programs for financial planning or assistance with student loans.
More than half of Americans are more stressed about their finances today than they were before the pandemic, and 43% said they had to tap their emergency funds since the crisis began to pay for medical expenses, home repairs, rent or bills, according to a Betterment for Business survey of 1,000 participants. Three-quarters of respondents said they plan to prioritize financial wellness benefits when they return to the office, and their top preferences are 401(k) and matching programs, followed by a wellness stipend, an employer-sponsored emergency fund and student loan repayment programs (they’d rather these benefits over an array of snacks or recreational activities in the office, they said).
The good news: Companies are tuned in to these desires. Employers are beginning to expand their benefit offerings, which helps employees but also keeps them competitive in the workplace, or their revamping the benefits they already offer. KPMG, for example, recently switched from matching 401(k) contributions to providing a direct contribution to the retirement plan, and it reduced employee healthcare premiums.
Review what benefits options you have available to you — there may be some you aren’t aware your company even offers.
Here are five employer benefit options workers should look out for, especially as they’d help sustain financial stability now and in the future:
- 401(k), 403(b) and 457 plans: These employer sponsored retirement plans are an excellent, tax-advantageous way to save for retirement, as they defer a portion of a worker’s salary into a retirement account. Some employers also offer matches on employee contributions up to a certain point. Although these matches often have vesting schedules, which means they aren’t technically the worker’s money until a specific number of years have passed, it’s still considered free money.
- Health Savings Accounts: Aside from health insurance, which is a major benefit employees seek from their companies, some policies — like high deductible health plans — also come with the option for a Health Savings Account. These accounts offer triple the tax benefits — money is contributed, grown and distributed tax-free when used for eligible medical expenses. The money can be used in the present, or can be held in the account for health costs in retirement.
- Student loan relief: Many young Americans struggle with paying off their student debt in a timely fashion, and it can be a barrier to save for retirement. Some employers are responding to that challenge, by either matching a student loan payment to a retirement account, or providing financial assistance in paying the debt off.
- Caregiving: Understand what is available to you in terms of time off and paid leave for caring for a child or sick relative. This has been a highly sought after benefit in the country, and has taken the spotlight in many legislative proposals.
Financial counseling: Companies may also bring financial planners or counselors in to discuss general financial planning topics, or help workers make sense of their own money management. This is a great option for understanding what can be done to get on track for big goals, including retirement.