Why retirement security is a workforce wellness issue

When people are struggling to keep up with the cost of living, it’s hard to think about the future. Groceries, gas, housing costs — it all adds up. And long-term planning often takes a backseat to making it through the week. 

So, it makes sense that most people are focused on fending off the financial “alligators” closest to the boat — the urgent and pressing challenges that can’t be ignored. But new research suggests something surprising: even amid this short-term stress, many workers are spending lots of time worrying about the alligator farthest from the boat — retirement. And what we do about that concern isn’t just about the future. It’s about employee health and well-being right now. 

The retirement crisis is already here 

We’re long past the point of calling retirement insecurity a “looming” issue. It’s here. Just a few years ago, 67% of Americans called it a crisis. Today, it’s 80%. Importantly, roughly half of private sector workers have no access to a retirement plan through their job. Those who are already struggling financially or mentally are less likely to have access to a retirement plan at work. For younger employees, especially Gen Z, participation rates for plans they currently have access to are substantially lower than for older workers.  

This isn’t just a financial health story — it’s a mental health one. We know that financial stress is one of the biggest drivers of poor mental health. Improving long-term financial security immediately impacts peace of mind, focus, and stability. 

Retirement benefits are wellness benefits 

In a recent study conducted by Dayforce with the research firm SSRS, 96% of full-time workers said increasing employer contributions to retirement plans would improve their mental health. More than half said it would be extremely helpful. 

When people feel more confident about the future, they perform better in the present. They’re less distracted, more engaged, and more productive. 

Our research also pointed to several promising benefits strategies that can make a real difference for employees: 
 

• Financial literacy and coaching: Over eight out of ten (82%) respondents said financial literacy training would improve their mental health and wellbeing. Among Black and Latino workers, that number rises to 92%, with nearly half saying it would be extremely helpful. When people understand their options, they’re better equipped to make confident decisions. 

• Emergency savings programs: Among women, 94% saw in-plan or “sidecar” accounts, which allow employees to save for emergencies within their employer-provided retirement plans, as helpful to their mental health. Forty-four percent said it would be extremely helpful. These accounts reduce stress and help workers avoid tapping into dedicated retirement savings or taking on high-interest debt when something unexpected arises. 

• Student loan retirement matching: Thanks to the SECURE 2.0 Act, employers can now match student loan payments made via withdrawals from employer-provided plans with contributions. Among Gen Z employees, 84% said this would help their mental health, with over four in 10 saying it would be extremely helpful. This is a sign that the next generation is hungry for smart, future-focused benefits that can also help them now. 

There’s a strong business case 

Supporting retirement security isn’t just good for employees — it’s good for business. 

Employees who feel financially secure are more likely to stay with their employer, recommend their workplace to others, and report feeling valued. Among workers under 30, nearly two-thirds said benefits like emergency savings accounts would improve their experience at work or their opinion of their employer. For workers dealing with mental health challenges, 62% said these benefits would improve their work experience. 

As you can see, offering stronger retirement benefits is more than a nice-to-have — it’s a competitive advantage. This is especially true as more members of Gen Z enter the workforce. They might be the farthest from retirement, but in our survey, 42% of these workers said increased employer retirement contributions would be extremely helpful to their mental health. And more than one-third said the same about an employer-provided financial literacy program. This shows that the quality of retirement benefits can significantly impact near-term employee and organizational performance. 

Policy matters, but companies can lead 

Public policy also has a role to play in solving the retirement crisis. Stronger safety nets, more inclusive retirement plan access, and higher wages are critical. But that doesn’t mean companies should wait. 

Experts at the Financial Health Network have recently identified simple, high-impact steps employers can consider taking right now: 
 

• Eliminate waiting periods for retirement plan eligibility 

• Include part-time workers in benefit programs 

• Offer financial guidance to support retirement readiness 

• Establish employee ownership programs to help build wealth 

Implementing these policies can help change lives and create a stronger, more loyal workforce. 

What happens next is up to us 

The tools are ready, and the business case is clear. What’s needed now is action.  

Retirement security is not just about a distant future; it is an immediate need that affects stress, productivity, and overall well-being. By assisting employees in building stronger financial futures, you are not only investing in their retirement but also in their well-being today.  

This is a goal that every company can support.