Study: Employees Increase Focus on Retirement Planning

In addition, just under 16% of employees report having no financial stress, up from about 3% of employees in 2010. Financial Finesse believes this is due primarily to significant improvements employees have made over the last year in their cash management to better manage their cash flow, reduce debts, and build an emergency savings fund.

Liz Davidson, CEO and Founder of Financial Finesse, says these and other findings from the report indicate that employees have shown a high level of resilience in the face of a difficult economy.

“Employees are not burying their heads in the sand,” she says. “They have accepted that this is the “new normal,” and they’re persevering through it. I’m really impressed with how they are rising to the occasion. They’re seeking education and continuing to take the right steps to improve their finances rather than giving up.”

Davidson warns, however, that U.S. employee retirement preparedness remains dismally low, with just 15% of employees year to date reporting they are on track to replace 80% of their income (or their goal) in retirement.

“While employees are definitely moving in the right direction, the landscape is shifting at a faster rate than employees are compensating for,” she says. “All the dynamics of rising inflation, higher tax rates, fewer companies providing monthly pension income to retirees, and depleted home values are coming together in a perfect storm that will require even more from employees than what they’re doing now in order to have a secure financial future.”