Financial literacy has become a priority for corporations, multiemployer trust funds and public-sector employers in both the U.S. and Canada, according to a survey by the International Foundation of Employee Benefit Plans.
The survey, conducted in February 2014, found that half of all organizations offer benefits literacy education and nearly half offer retirement security education, but only one-quarter offer financial literacy education.
More than one-third of organizations offering financial education said they have started offering this education in the past five years. Nearly two in five respondents said they feel responsible for educating retirement plan participants about their pension and benefit options. They also want to encourage retirement savings and help participants become financially literate managers of their money.
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An additional two in five plan sponsors feel their responsibility is only to educate on pension and benefit options and encourage retirement savings and another one in five feels their responsibility is only to educate on pension and benefit options. Fewer than 5 percent feel no responsibility to educate on retirement benefits or financial matters at all.
The survey found that one in six organizations has a budget for financial literacy education, and among those organizations, more than one-third plan to increase their financial education budgets in the next year. Nearly one in five organizations that don't have a financial literacy budget said they are considering adopting a budget.
Organizations that offer financial education focus on retirement plan benefits, investments and savings.
Out of the nearly 400 organizations that responded to the survey, most believe personal financial issues have a major impact on the overall job performance of their employees and most rate the overall stress level of their employees as medium to high.
The two biggest financial challenges facing employees are saving for retirement and credit card or other debt, respondents said. Most employers believe their employees are not well-prepared for retirement upon reaching retirement age.
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