Financial Finesse Releases First Quarter Research on Employee Financial Issues for 2012

Study finds that proactive financial focus persists as employees seek balance between short-term and long-term financial concerns.

El Segundo, CA—Financial Finesse, the nation’s leading provider of workplace financial wellness programs, has released its latest research report on employee financial trends based on an analysis of questions received by its team of CERTIFIED FINANCIAL PLANNER™ professionals and employees’ responses to an online financial wellness assessment.

The firm found that employees’ proactive focus on retirement planning was sustained in the first quarter of 2012. Yet, despite a strong market rebound over the last couple of quarters, employees remained uncertain about their investing decisions and ability to retire. This appears to be a result of employees continuing to realize they are not on track to retire comfortably since the recession. Notable findings from the report were:

• Employees continue to report dangerously low levels of retirement preparedness. Only 14% of employees reported being confident they were on track to retire with 80% of their income (or their goal) in retirement. This is a slight drop from 15% in Q1 2011.

• Employees are becoming more proactive about their finances in general, and retirement planning in particular. Adjusted for seasonal tax questions, 73% of employee financial questions were proactive, focused on taking control of finances to increase success, versus reactive, focused on addressing a pressing financial problem. This is an improvement from Q1 2011 when 67% of employee financial questions were proactive in nature.

• Investing confidence has not improved despite recent stock market gains. Only 33% of employees were confident their investments were allocated appropriately in Q1 2012 – down from 34% in Q1 2011.

Liz Davidson, CEO and Founder of Financial Finesse, says that although employees are far from where they need to be, they are showing positive growth by realizing they are behind as they continue to put strong emphasis on proactive financial issues. Davidson is concerned, however, by a slight drop in financial wellness scores reported in Q1 2012 vs. Q1 2011 and worries that, if it continues, it could impact the trend towards more proactive financial planning. For now, she and the company’s Think Tank of CERTIFIED FINANCIAL PLANNER™ professionals are monitoring this closely to see if it’s a temporary blip or evidence of a bigger issue to come.

In the meantime, they are impressed by a much more positive trend of lower-income employees reaching out for help and engaging with financial wellness programs, something that lower-income employees often eschewed in the past believing that financial planning was for the wealthy and had nothing to offer employees with more limited assets. Davidson notes that the firm is seeing broader usage of its online Financial Wellness Assessment across more demographics, and it is now reaching “second stage adopters” who avoided engaging with the program in the past. According to Davidson, “More employees are concerned about where they stand regarding their financial picture and are seeking ways to improve it, with the biggest growth among a group that we’ve traditionally had a hard time reaching—lower-income employees. This is obviously a very positive trend, and we hope to see this group continue to improve their financial planning awareness, and ultimately their wellness.”

Dperry@financialfinesse.com
(424) 218-7954

Financial Finesse is an unbiased financial education company providing personalized and
innovative financial education and counseling programs to over 500,000 employees at over 400
organizations. Financial Finesse partners with organizations to reach goals such as reducing
fiduciary liability, increasing plan participation, decreasing stress, and increasing productivity
through its unique approach to financial education. Financial Finesse does not sell products nor
manage assets. For more information, visit www.financialfinesse.com.

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