Financial Wellness Is a Priority for Generation Z

First, the bad news. Only 12% of Generation Z employees say their financial well-being is high, according to a 2022 survey by the insurance company TIAA. And almost 45% of Gen Z respondents said that financial concerns had negatively impacted their work.

But here’s the good news. Employee Benefit News reports that Gen Z employees are the most eager to learn about finances and the most willing to turn to their employers for help.

This combination — the need for help and being open to it — is how you get the most bang for your benefits buck. Follow these tips to target your financial wellness efforts to the needs of Gen Z employees:

• Customize your financial content.
• Add layers with continuing education.
• Be transparent about costs and emphasize confidentiality.
• Use digital tools.

Customize your content

With multiple generations in the workforce, you can’t use the same financial material across the board. To engage your Gen Z employees, tailor financial education to their needs.

To start, you may want to emphasize short-term goals, like filling out an online budgeting worksheet. This will ensure they experience early success and build confidence for learning more.

You should also understand the most pressing financial concerns for your Gen Z employees. Their top issues are likely to be immediate, such as:

• The effect of inflation on food and everyday goods
• Rent and housing
• Student debt and tuition reimbursement
• Credit card debt and budgeting
• Emergency savings

Addressing Gen Z’s immediate concerns will lead to higher participation and engagement in your financial education. In addition, building core competencies in finance can increase their willingness to tackle more complex financial matters.

Continue to educate

Once you’ve built a foundation of financial learning, add in layers for long-term goals such as:

• Retirement savings
• Down payments for housing
• Unexpected health care expenses
• Child care and elder care costs

Explain how immediate and future needs are intertwined. For example, you can connect the dots between having emergency savings and avoiding high-interest credit card debt, which leads to more disposable income and increased retirement savings, and so on.

Linking Gen Z employees’ near-term needs to their golden years takes some planning and effort, but it can make them more likely to stick with the financial goals they put in place through your educational initiatives.

Demonstrate transparency and confidentiality

Transparency and confidentiality are vital to your financial wellness efforts. In the TIAA survey, about 75% of employees said they were hesitant to access employer-sponsored financial wellness programs.

This held true even among Gen Z employees, despite their being the most open to employer education. The two biggest concerns are:

• The potential for hidden expenses
• Unease with employers knowing about financial struggles

Hidden expenses

To address the concern about hidden expenses, you should be upfront about any costs to employees. Better yet, make sure your financial wellness initiatives are delivered at no cost.

If your budget is limited, take advantage of free educational options, including budgeting apps and online courses on topics such as financial literacy, debt management and investments. In addition, many retirement plan administrators offer free or low-cost financial education resources.

In recent years, an increasing number of employers have provided employees with personal coaches as part of a financial training platform. This type of program typically costs around $100 per month per employee.

Even if you cover that cost in full, you should be upfront about any potential sales or marketing tactics they can expect from the coaching vendor. Your employees will appreciate your honesty and be more likely to participate in this and other financial wellness programs.

Disclosing financial woes

For the second concern, you’ll need to frequently communicate that your financial education programs are anonymous. Assure your employees that participation is voluntary and you will not collect personally identifiable information.

You can also frame participation as a positive. For example, taking part in financial education shows:

• Personal growth and responsibility
• Professional development
• A willingness to address difficult challenges

By emphasizing these positives as signs of leadership, you can ease hesitancy and further break down barriers to participation.

Use digital tools

To reach Gen Z employees, you need to speak their language — specifically, their love of digital communication. Use digital tools such as:

• Social media?— Communicate educational opportunities through a variety of platforms that are popular with Gen Z, including Instagram, TikTok and Snapchat. Gen Z is more likely than other generations to listen to social media influencers. Sharing financial videos from a reputable influencer can engage your employees and drive them to your efforts.
• Smartphone apps?— Gen Z employees have grown up with smartphones and turn to them for almost every aspect of life. Financial education is no different. Your online education should be optimized for mobile use, with a fast and easy user experience.
• Chat?— Your youngest employees prefer to find information online and on their own. But if they can’t find what they’re looking for, they want the ability to ask questions through chat instead of a phone call or in-person meeting. Implementing chat functions to deliver answers is another way to increase engagement with financial education, according to a report by Fidelity Investments.
• Online courses?— Virtual education is more than a familiar tool for Gen Z. It’s an expectation. Online courses allow them to learn at their own pace, and it feels more anonymous than a workshop or in-person class. As with other digital tools, they want an interactive user experience personalized to their financial needs and interests.

It all adds up

You put a lot of planning and hard work into your financial education. It helps to know that your efforts are likely to be embraced — and pay big dividends for your Gen Z employees.

TIAA reports that 65% of Gen Z respondents want employers to help them improve their financial wellness. The survey also revealed that employees who participated in financial wellness education were two times as likely to report good financial health.

To explore more financial wellness initiatives and solutions, talk with your insurance broker or benefits adviser. They can help you find a variety of financial education tools and tailor them for your Gen Z employees.

Blue Ridge Risk Partners?is a top 75 independent insurance agency in the United States. With 22 offices and counting throughout Maryland, Pennsylvania, and West Virginia and access to hundreds of carriers, we are able to meet your unique insurance needs.