Employee Financial Wellness in America

Against a backdrop of inflation and economic uncertainty, employees are stressed about their finances. They’re feeling the impact, and there’s growing evidence that the majority lack the financial skills necessary to tackle such challenges.

 

Sixty-six percent of employees are stressed about their financial situation, and 76% believe that the cost of living is outpacing growth in their income.1 When employees are stressed about their finances, it has deep impacts on workplace productivity, creativity and morale. The good news is that employees are looking to their employers for help, and we’ve seen employers’ sense of responsibility grow, significantly expanding the scope of financial wellness programs.

 

This 2025 study focuses on understanding — through a generation, gender and income2 lens — the financial wellness of 88,735 401(k) participants on Bank of America’s record-keeping system. We’ve also included trend analysis from 135,195 401(k) participants in 2021,88,714 participants in 2022 and 105,127 participants in 2023. The findings can help employers gain a greater understanding of employees’ behaviors and financial needs so they can better tailor workplace benefits programs that inspire employees to take action to help improve their financial health.

 

Key findings

1. Our study shows that employees are struggling to manage short-term expenses as well as meet long-term financial goals.

A scale with short-term expenses lower than long-term financial goals

2. Women continue to trail men in managing their day-to-day finances, which limits their ability to make progress toward saving for retirement.

3. Younger generations are weighed down by student debt, while older generations are at risk of not having enough money to retire.

4. Lower income groups are often unable to make ends meet, are carrying credit card debt and may find it difficult to cover their living expenses in the event of job loss or unexpected expense.

Read our executive summary, study and brief study for a more in-depth look at these findings.

1 2024 Workplace Benefits Report, Bank of America Corporation, 2024.

2 Refers to household income.

3 Bank of America 2024: Gender Lens in Defined Contribution (DC) Plans study of 3.1 million 401(k) plan participants shows that the median 401(k) balances for women are approximately 72 percent that of men.

4 Based on data from the Federal Reserve Report Economic Well-Being of U.S. Households in 2023, May 2024. One in every five Americans has a student loan debt, and even though the majority of the debt is held in large loans, most of the students indebted owe $25,000 or less.

5 Source: Bank of America Financial Wellness Tracker for the period January 2024 to December 2024. Based on the responses of 417,771 401(k) participants. Calculations by CIO Portfolio Analytics.

 

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