Workforce research from Unum shows employees feel financially fragile, but benefits can boost sense
May 8th 2013 10:21AM
Updated May 8th 2013 10:35AM
Workforce research from Unum shows employees feel financially fragile, but benefits can boost sense of security
CHATTANOOGA, Tenn.--(BUSINESS WIRE)-- Unum's fifth annual survey of working Americans shows that more employees feel financially insecure, with more than 40 percent postponing retirement and half saying they aren't confident they have enough savings for future expenses or to cover lost income if they are sidelined by illness or injury.
The survey of 1,890 working adults finds that more than a third (36 percent) don't feel financially secure, and the percentage who feels "not at all secure" (currently 16 percent) has increased over 2011. Women (40 percent) are significantly more likely than men (33 percent) to feel financially vulnerable.
"Anxiety over finances increased in 2012, indicating that the modest improvements to our economy are not yet being felt by working Americans," said Barbara Nash, vice president of research for Unum (NYS: UNM) .
An unsteady economy has made employee benefits more important than ever to the financial security of individuals and families. More than three-quarters (77 percent) of employees who rate their benefits package as excellent or very good say they are financially secure.
The research was conducted online in December 2012 by Harris Interactive following the fall benefits enrollment period. When survey participants were asked what their current target retirement age was, the average was 67.1, an increase of 2.6 years over what they reported it being five years ago. Those ages 55-plus expect to retire after their 70th birthday, while those 18-34 are expecting to retire at age 65.
Employees cite their personal financial situation (57 percent) as the leading reason for shifting their retirement age.
If an employee experiences an illness or injury that would interrupt their ability to work, only one-third could rely on employer-sponsored disability benefits. Employees say they are most likely to use personal savings (56 percent) or rely on family members (52 percent) if unable to work.
"This research underscores a disconnect between financial expectations and realities," Nash said. "Research indicates that a very large percentage of Americans are living paycheck to paycheck. Yet our findings show that employees still believe they can rely on savings and each other if an illness or injury occurs."
Employers can play an important role in helping their employees feel more financially secure, however, by offering important benefits like disability insurance and by communicating the value of these benefits as clearly as possible.
"Providing employees with disability insurance - which replaces an average of 60 percent of income if an employee is unable to work because of illness or injury - goes a long way in settling financial anxieties of employees," Nash said.
Communicating the value of these benefits appears to have a payoff for employers as well.
A positive assessment of benefits education is strongly related to overall workplace satisfaction. The research shows that more than three quarters (81 percent) of employees who rated their benefits education highly also rated their employer as an excellent/very good place to work.
Source: Unum's Employee Education and Enrollment Study, conducted by Harris Interactive, December 2012.
Unum is a leading provider of financial protection benefits through the workplace. The disability insurance leader in the U.S. for 36 years, Unum's portfolio of financial protection products also includes life, accident and critical illness, which help protect millions of working people and their families in the event of an illness or injury. In 2012, Unum paid $5.5 billion in benefits to nearly 490,000 individuals and their families.
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