Do Millennials Want Your Retirement Plan?

People's backs looking out a coffee shop window. Working on laptops and drinking coffee.

Almost 79% of employees have access to a 401(k). But adoption rates are often very different depending on the industry. Only 32% of Americansare saving into a 401(k) for retirement.

Unfortunately, employers are losing money by not providing the right perks.

By better understanding why some employees aren’t enrolling in retirement plans, businesses can better address employees’ needs.

Employee Demographics

Most organizations are diverse and so are the needs of their employees. But two employee segments in particular are at higher risk for not contributing to a retirement plan.


Because retirement can seem far off, nearly 70% of younger employees report that they’re not currently saving for retirement. They’re more concerned with paying their bills.

Additionally, many millennials face an average of $30,000 in student loan debt. Their focus is to repay the debt before retirement enters their financial scope.

It’s only once employees reach their 30’s and 40’s that they’re in a better financial position to start stashing money.

Low-wage workers

Lower-waged workers making less than $15/hr are also likely not utilizing retirement programs.

Lower-income workers are facing many of the same challenges as their higher paid peers. Namely, they’re paying down debt, budgeting, or paying for child care. Unfortunately, their lower wages make it difficult, if not impossible to start saving for the future.

Complicating matters is that almost half of all low-income workers work for smaller companies (fewer than 10 employees), which means that they are often not offered benefits or higher wages due to the financial impact to the businesses.

Low-wage workers cite budgeting and child care expenses as their number one financial concern. Unfortunately, their short-term needs outweigh their ability to plan for their future.

Financial Wellness

For millennial and low-wage workers who may not yet be focused on retirement, the first step to help them reduce their financial stresses is better access to financial guidance to build their financial confidence.

Financial wellness programs can help employees better manage their financial stress and identify tools and benefits that can help them solve their financial challenges more quickly.

Providing financial wellness can also start the conversation among employees for when they eventually utilize the retirement benefits their employer might offer.

By taking the first step of identifying wellness benefits to help employees understand their financial position can help them process both short-term financial wellness and long-term financial independence.

While the culture of retirement saving should shift to encourage more employees to save for retirement regardless of their age, employers should understand that the retirement needs of some employee groups are vastly different.

While retirement benefits may be appealing to more experienced employees; new graduates, millennials, and low-wage employees are likely not yet thinking about retirement at all and need help with their short-term financial needs.


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