By Rob Starr, Big4.com Content Manager
PwC’s Employee Financial Wellness Survey took a look at the financial and retirement wellbeing of working U.S. adults by looking at the responses from more than 1,700 full-time employees. The survey found, among other things, financial stress and retirement readiness concerns linger and that each working generation had a particular subset of concerns. Kent Allison, Partner and National Practice Leader of PwC’s Employee Financial Education and Wellness Practice, talked with Big4.com recently about the results and their implications.
“When you look at Gen Y, they are probably the most stressed. They’re dealing with immediate cash flow issues, so debt and cash flow are top of mind for them,” he says adding there is some offsetting general good news about the report. “We’re trending better, but there are still some significant issues and concerns for each of the generations and the total
population as a whole.”
This year’s results need perspective so they can be better understood. PwC’s Employee Financial Wellness Survey started in 2012 and since then, there’s been a growing positive sentiment among respondents, although that year was a bad starting point when results were at a low point.
“If you were to look at 2015 without that perspective, you wouldn’t have an overall rosy picture,” Allison points out. For example, retirement confidence has increased sixteen percentage points to 43 percent since 2012, but at the same time one-in-five employees (21%) say they aren’t saving for retirement at all.
Getting flushed out of the housing market through foreclosures and an overall belt tightening through stagnant wages have helped Gen Y get their situation better under control. Allison moves next to Gen X, a group whose money issues are caused by what he calls, “competing priorities.”
He says they are the generation that follows a chronological order and therein lies at least part of the problem.
“They buy the home and then fund their children’s education. Perhaps they get blindsided by an elderly sick parent, and then they focus on retirement. They’re dealing with a myriad of issues and how to prioritize them and sometimes they make the wrong decisions by doing it in chronological order.”
At the far end of the scale, the Baby Boomers are worried about retirement and running out of money. According to Allison, these were the stressors that pervaded the biggest worries for every generation. He also says the research saw improvements from last year only in those generations that already had assets built up.
Because Millennials must rely on stagnant wages, have saved less and have smaller equity in their homes, they continue to be the group with the highest risk.
“Without having substantial assets built up yet, they’re not feeling the relief of the stock market as great as Gen Y and the Baby Boomers,” Allison says.
Read the full report by clicking here.