In the fight for Millennial talent, employers with strong financial wellness programs can set themselves apart for a generation of high hopes and deep debt.

In the war for talent, companies are spending considerable resources trying to create environments that appeal to Millennials. Companies know that these tech-savvy workers care about things like access to digital tools, chances to collaborate and opportunities to find a sense of purpose and belonging in their work. There’s something else they want, too: help managing their financial lives.

Millennials are very stressed about money. In fact, 74% of Millennials say they have an extreme amount, a great deal or a fair amount of financial stress, which is far more than either Generation X workers or Baby Boomers, according to a survey of 1,000 employees of mid-size to large companies, conducted by the Financial Health Network on behalf of Morgan Stanley.1

Millennials, born between 1981 and 1996, are now the largest generation in the U.S. labor force, and as more Baby Boomers retire each year, employers know that it’s crucial to attract and retain young workers. Helping them to cultivate a sense of financial wellness may be one of the biggest areas where employers can step up and differentiate themselves.

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Why Are Millennials So Stressed About Money?

From student loans to credit cards, Millennials worry about paying down debt and how hard it can be for them to create the lives they want while bearing that burden. Among the key survey findings:

  • 46% of Millennial employees say they have more debt than is manageable, compared to 38% of Gen X and 23% of Boomers.

  • 43% of Millennial employees say they are unable to pay their bills on time, compared to only 34% of Gen X and 16% of Boomers.

  • Millennial employees are also more likely to spend more than they earn and have less than two weeks of living expenses in savings.

These hurdles can make it hard for Millennials to focus on the major life transitions and milestones ahead, such as marriage, buying their first home and starting a family. And despite the benefits of compounding their earnings over the coming 30 or 40 years in the workforce through savings and investments, these workers, now in their 20s and 30s, may struggle with how to plan and save for retirement, amid more immediate financial needs.

“When starting out, retirement can seem like a far off concept. But investing for retirement early can help Millennials achieve the financial independence to live life on their own terms,” says Krystal Barker Buissereth, head of Financial Wellness for Morgan Stanley Wealth Management. “However, it’s difficult to plan for the long-term when you’re focused on short-term debt and emergency saving challenges.” 

In fact, 60% of Millennial employees cite “building retirement savings” as a major long-term financial need, compared to 52% of Gen X and just 45% of Boomers. Millennials also need help with choosing and monitoring investments, and saving for their own or a family member’s education, the survey found. 

What Millennials Expect From Employers

Millennials are actively seeking help and tools to bring their financial lives into balance, the survey found. In fact, nearly 3-in-4 Millennials say they are more likely to stay at a job that offers useful financial wellness benefits.  Eighty percent say it’s important that an employer offers financial wellness benefits like low-cost loans and online investing apps. And when their employer offers them, about 60% of millennials say they use them.

Millennials also want to feel like they are part of something bigger than themselves, and that their employer cares—not just about them as a worker, but about the bigger picture and impact they have on society, Buissereth says. This is where financial wellness programs can be a game-changer for organizations that want to engage with this generation.

“Financial wellness is about a company saying, ‘We care about you, we are thinking outside the box, and we want to help you accomplish your goals and thrive,’” says Buissereth.

Digital Engagement + The Personal Touch

The good news: Millennials feel more comfortable receiving financial guidance through the workplace than either Gen X or Boomers, according to the survey. They are also more open to digital forms of engagement, Buissereth says. According to the survey, Millennials are more likely than other generations to prefer digital tools, such as online calculators, webinars, social media platforms and online chat rooms.

Still, a personal touch remains crucial. “It’s true that Millennials are more likely to adopt online engagement than others, but we also see in the data that they want to have live meetings or go in person to an event,” Buissereth says.

Ultimately, many paths exist to reach this cohort and coach them on financial fitness, Buissereth says. Whether it’s paying down debt, building credit or budgeting, Millennials will appreciate the high-tech engagement strategies, but still search for something remarkable. An employer that offers them a variety of ways to connect and to help them maximize their financial wellness can set themselves apart from other employers.

Helping Millennials Improve Their Financial Lives

Morgan Stanley at Work Financial Wellness focuses on helping employers engage employees through personalized financial education, advice and solutions. By targeting the needs of Millennials and other employee groups, companies can build financial wellness programs that benefit both their people and their business.