Consider an employee saddled with student loan debt who may be hesitant to contribute a meaningful portion of their salary to retirement. Or a household without an emergency savings fund tempted to put future goals at risk when faced with a financial shock. These scenarios can have serious long-term implications for participants. They can also have an impact on their day-to-day lives. In fact, 1 in 5 employees admit that personal finance worries have affected their productivity at work.2
What is financial well-being?
Financial well-being means more than just money in the bank. To us, it means the ability to meet today's financial needs while continuing to build toward long-term retirement goals. It's also the feeling of optimism that employees experience when they understand their finances and are confident in their ability to pay bills, weather financial shocks, and live the lives they love today—without jeopardizing their long-term security.
With that as our goal, we're focused on delivering a program that meets the needs of participants, supporting them as they get their finances under control, protect against the unexpected, and make progress toward their goals.
Our targeted approach is tailored to participants' unique circumstances and focused on getting them to take the next best action each time they engage with us. Too much information or too many choices can potentially overwhelm and confuse participants. That's why we offer one recommendation, based on data and Vanguard research, to drive positive outcomes. In 2021, 60% of Vanguard participants took at least one action to improve their retirement readiness.4