PLANSPONSOR - April/May 2020 - 14

UPFRONT
New Virus Tests the Limits of 'Wellness'
OFFERING a financial wellness program
to employees was considered a valueadded
benefit, but the novel coronavirus
pandemic suggests it is an urgent necessity.
" This outbreak has just shone a light
on an existing problem: Too many people
are already living paycheck to paycheck, "
says Brian Hamilton, vice president at
Smart Dollar. " American workers are up
to their eyeballs in consumer debt. We
spend more than we make. We have little
to nothing saved, and we're not putting
money away for retirement. We will get
through this, and when we do, everything
must change. "
A just released survey from First
National Bank of Omaha finds 59% of
U.S. adults say they have lost income as a
result of the coronavirus, 45% report they
are having trouble paying bills, and 52%
TIDBIT
Millennials' vs. Gen Z's Top Financial Priorities
The two youngest generations in the workforce understand the importance of saving for
retirement, but many have short-term concerns that win out over long-term planning.
■ Millennials ■ Generation Z
say they have insufficient savings to cover
three months with no income.
Hamilton says employer financial
wellness programs should be covering the
basics of what to do in an emergency and
encouraging people to create an emergency
savings fund. " Coronavirus is shedding
a big light on how bad it was. Americans
are not prepared to handle a financial
emergency-let alone a pandemic. "
Asked whether participants should
be putting money into an emergency
savings fund while participating in their
retirement plan, Nancy Hite, president
and CEO of The Strategic Wealth Advisor,
says she strongly believes creating an
emergency savings fund that would cover
six months' worth of spending should be
people's first priority.
A Hearts & Wallets survey in late
March found Americans' No. 1 financial
goal is to build an emergency fund, with
45% prioritizing it as such. This is similar
to the 47% found last fall, but it jumps to
65% for respondents who reported that
their work status is vulnerable. Almost
two-thirds (63%) of consumers said they
plan to spend less post-COVID-19, and
the data show buying a new home or car
or taking a vacation have dropped as goals.
" The first thing that's going to happen
to financial wellness programs following
this pandemic is they're going to focus on
helping people be holistically financially
well, " says Laura Varas, CEO and founder
of Hearts & Wallets. " This is a tipping
point for us to shift away from consumption
to being financially well. One of the
most important things is having a liquid
emergency fund. " -Lee Barney
20%
18%
19%
15%
11%
Building a
savings fund
Saving for
retirement
Purchasing
a home
16%
16%
9%
Starting a family/
Having children
Repaying
student loans
Source: Betterment for Business, " Employee Retirement Preparedness: Millennials and Gen Z, " from a survey conducted last fall
18%
20%
14 PLANSPONSOR.COM April - May 2020

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PLANSPONSOR - April/May 2020

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