EMPLOYERS: The Financial Well-being of Employees is Deteriorating. The Time to Act is NOW.

Have you ever watched news coverage of a wildfire? A fire typically starts small, and there is a limited window of opportunity to try and contain it before it burns out of control. If firefighters can’t control a fire, they’re forced into defensive mode and can only hope to contain the damage.

Today, financial stress is growing for most Americans. Stressors are coming from multiple directions, making it feel like a financial wildfire. How bad is it?

• Expenses across all household budgets are up 6.1% due to inflation.¹
• 67% of employees say that they don’t have enough savings to cover three months’ worth of living expenses.²
• Many people are dealing with an average household debt of $101,915.³

Without help, this financial wildfire could cause irreparable damage to the overall well-being of employees. So let’s dive a little deeper into some trending data concerning employees’ mental and financial health, reviewing data from the Mental Health Index’s (MHI) most recent employee survey. We’ll also take a look at how MSA is helping employees reduce their financial stress.

“Since the launch of the MHI [in April 2020], women have had significantly lower mental health scores than men. In February 2023, the mental health score of women was 67.4 compared to 72.7 for men.”⁴

One of the top reasons women don’t reach out for financial advice or coaching is embarrassment. Over 50% of MSA Money Coaches are women, and all are trained to initiate comfortable, non-judgmental conversations.

“Nearly half (45%) of workers in the survey have been negatively affected by a recession or economic downturn.”⁴

With daily media reports stating a recession is imminent in 2023, those hurt by previous economic downturns are experiencing heightened levels of stress. Also, most households are struggling to maintain or increase savings due to the rising costs of goods and services (inflation). 62% of employees say that inflation has somewhat impacted to highly impacted their ability to pay monthly bills.²

MSA Money Coaches help employees assess their spending and savings practices. This typically leads to new goals or slight adjustments to spending behaviors, resulting in employees having more confidence in their futures. Employees who work with a Money Coach for at least three sessions experience an average 90% improvement in financial well-being!⁵

“Individuals without emergency savings continue to experience a lower mental health score (51.7) than the overall group (69.8).  Individuals with emergency savings have a mental health score of 75.9.”⁴

According to a study by the Consumer Financial Protection Bureau (CFPB), “Consumers’ level of emergency savings generally aligns with their overall financial profiles.  Consumers with no savings are the most likely to have no or a subprime credit score, delinquent debt, and low financial well-being, while consumers in the highest emergency savings group generally have healthy financial profiles including prime credit and above average financial well-being.”⁶

At MSA, one of the primary tenets of protecting personal finances is having an adequately funded emergency savings account. When Money Coaches work with employees to prioritize emergency savings, they increase their savings balances by an average of over $6,000!⁵

“Two in five (40%) workers in America have felt overwhelmed by debt, and this group has the lowest mental health (59.6) and financial well-being (51.4) scores.”⁴

In the fourth quarter of 2022, the Federal Reserve Bank of New York reported that total household debt rose to $16.9 trillion and that credit card debt passed the pre-pandemic high ($927 billion) to reach $986 billion.⁷

When MSA Money Coaches help employees set debt reduction goals, they help reduce debt balances by an average of over $4,900!⁵

The good news is that most employers already have a financial well-being first responder team ready to help – My Secure Advantage (MSA). MSA’s financial well-being solution is embedded in the vast majority of Employee Assistance Programs (EAPs). This means employees can typically start using MSA at no cost, thanks to their employer.

How can employers act now to help employees manage financial well-being?

1. Contact their EAP and learn about the financial well-being benefit that is embedded.
2. Communicate to employees about how to access MSA at no cost.

To learn more about how you can partner with MSA to empower employees to take charge of their financial futures, visit mysecureadvantage.com/why-msa.

¹ “All Items Less Food and Energy in U.S. City Average, All Urban Consumers, Not Seasonally Adjusted.” U.S. Bureau of Labor Statistics, U.S. Bureau of Labor Statistics, 2023, https://data.bls.gov/timeseries/CUUR0000SA0L1E?output_view=pct_12mths. Accessed 5 May 2023.

² MSA’s 2022 Pulse Survey (MSA: Dec. 2022). Based on member data collected from Nov.-Dec. 2022.

³ Fay, Bill. “Demographics of Debt.” Debt.org, 3 April 2023, https://www.debt.org/faqs/americans-in-debt/demographics/. Accessed 5 May 2023.

⁴ The Mental Health Index by TELUS Health (formerly Lifeworks): February, 2023 – United States. TELUS Health, 30 March 2023. PDF. Accessed 5 May 2023.

⁵ My Secure Advantage, Inc., January 2023. Based on MSA member self-reported data, when a member is working with a coach on this specific issue, from 1/1/21 – 12/31/22.

⁶ Ratcliffe, Caroline, et al. “Emergency Savings and Financial Security.” CFPB Office of Research Data Point No. 2022-01. Consumer Financial Protection Bureau, March 2022, https://files.consumerfinance.gov/f/documents/cfpb_mem_emergency-savings-financial-security_report_2022-3.pdf. Accessed 5 May 2023.

⁷ Pitterson, Shelley. “Total Household Debt Reaches $16.90 Trillion in Q4 2022; Mortgage and Auto Loan Growth Slows.” Press Releases, FEDERAL RESERVE BANK of NEW YORK, 16 Feb. 2023, https://www.newyorkfed.org/newsevents/news/research/2023/20230216. Accessed 5 May 2023.

My Secure Advantage, Inc. or any of its representatives do not endorse any of the websites or company names listed here. This content is for informational purposes only and does not guarantee eligibility for the program or its services.