1. January 24, 2012 SHRM Survey Findings: Financial Education Initiatives in the Workplace

2. Financial Education Initiatives in the Workplace ©SHRM 2012 Definitions 2  Financial education: Any workplace initiative, program or resource designed to provide employees with information on how to manage their financial resources effectively for a lifetime of financial well-being.  Employee Generations  Veterans: born before 1946; 67 years of age or older  Baby Boomers: born between 1946 and 1964; 48 to 66 years of age  Generation X: born between 1965 and 1980; 32 to 47 years of age  Millenials: born after 1980; 31 years of age or younger

3. Financial Education Initiatives in the Workplace ©SHRM 2012 Key Findings 3  What are the most common personal financial challenges? Almost one-half of HR professionals (49%) indicated that the personal financial challenge that affected employees at their organizations the most was an overall lack of monetary funds to cover employees’ personal expenses. Furthermore, more than one- third of HR professionals (35%) indicated that medical expenses were a significant financial challenge for employees at their organizations, and approximately one-quarter of HR professionals (26%) pointed to saving for retirement as a major challenge for employees. Not surprisingly, organizations whose employees were primarily represented by a particular generation (e.g., a greater proportion of Millenials or Baby Boomers) reported different personal financial challenges.  Are employees currently more likely to dip into their retirement savings plan? The majority of HR professionals (72%) said that they strongly agree or agree that their employees were more likely to dip into employer-sponsored retirement savings plans in the past 12 months compared with previous years.  Do personal financial challenges affect overall employee performance? The majority of HR professionals (83%) indicated that personal financial challenges had a large impact or some impact on overall employee performance. Of these HR professionals, almost one-half indicated that an employee’s ability to focus on work (47%) and overall employee stress (46%) were the aspects of employee performance that were most negatively affected by personal financial challenges.  Are organizations providing financial education to their employees? Currently, fewer organizations (52%) are providing any kind of financial education to their employees than in 2009 (64%). Larger organizations (2,500 to 24,999 employees) (72%) are more likely to offer financial education to their employees compared with smaller organizations (1 to 99 employees) (36%).

4. Financial Education Initiatives in the Workplace ©SHRM 2012 Key Findings 4  What aspects prevent organizations from providing financial education to their employees? Approximately one-fourth of HR professionals indicated that the cost of providing financial education (25%) and lack of interest among its employees (23%) were the biggest obstacles that prevented them from offering financial education to their employees. Also, 15% of HR professionals indicated that there was a lack of support from organizational leaders.  What types of financial education do organizations provide to their employees? The majority of organizations provide access to an employee assistance program (EAP) that includes financial counseling/resources (79%). Many organizations also offered education limited to the use of employer- provided benefits such as retirement, medical insurance and flexible spending account (FSA) information (68%).  How do organizations provide financial education to their employees? Most often, organizations provide financial education through voluntary seminars during work hours using outside speakers (60%). Organizations also communicate their financial education through new-hire employee orientations (44%) and the intranet (40%).  What are the biggest obstacles organizations face in providing financial education to their employees? Interestingly, concerns that prevent organizations from creating financial education programs for their employees are similar to obstacles reported by organizations that already provide financial education. Among organizations that currently offer financial education, 33% indicated that the cost of providing education was the biggest obstacle, while 25% said it was a lack of interest among employees. However, fewer organizations (21%) encountered obstacles in offering financial education to their employees in 2011 compared with 2009 (33%).

5. Financial Education Initiatives in the Workplace ©SHRM 2012 In the past 12 months, which of the following personal financial challenges have affected employees at your organization the most? 5 Note: n = 459. Respondents who answered “Not sure” were excluded from this analysis. Percentages may not equal 100% due to multiple response options.

6. Financial Education Initiatives in the Workplace ©SHRM 2012 In the past 12 months, which of the following personal financial challenges have affected employees at your organization the most? Other generationsVeteransDifferences based on generations 12%40%Veterans > other generations 6 Comparisons by employee generation HR professionals from organizations where Veterans (those born before 1946) represent the largest percentage of the workforce are more likely to indicate that educational expenses are a personal financial challenge for employees, compared with HR professionals from organizations where other generations make up the largest percentage of the workforce. Other generationsBaby BoomersDifferences based on generations 21%35%Baby Boomers > other generations HR professionals from organizations where Baby Boomers (born 1946-1964) represent the largest percentage of employees are more likely to indicate that saving for retirement is a personal financial challenge for employees, compared with HR professionals from organizations where other generations make up the largest percentage of the workforce. HR professionals from organizations where Generation X employees (born 1965-1980) represent the largest percentage of the workforce are more likely to indicate that credit card debt is a personal financial challenge for employees, compared with HR professionals from organizations where other generations make up the largest percentage of the workforce. Other generationsGeneration XDifferences based on generations 18%26%Generation X > other generations

7. Financial Education Initiatives in the Workplace ©SHRM 2012 In the past 12 months, which of the following personal financial challenges have affected employees at your organization the most? Other generationsMillenialsDifferences based on generations 7%19%Millenials > other generations 7 Comparisons by generation (continued) HR professionals from organizations where Millenials (born after 1980) represent the largest percentage of the workforce are more likely to indicate that home rental payments are a personal financial challenge for employees, compared with HR professionals from organizations where other generations make up the largest percentage of the workforce. HR professionals from organizations where majority of employees are female are more likely to indicate that educational expenses are a personal financial challenge for employees, compared with HR professionals from organizations where majority of employees are male. Male employeesFemale employeesDifferences based on gender 11%19% Female employees > male employees Comparisons by gender

8. Financial Education Initiatives in the Workplace ©SHRM 2012 Do you agree that in the past 12 months, employees have been more likely to dip into their employer-sponsored retirement savings plans compared with previous years? 8 Note: n = 376. Respondents who answered “Not sure” were excluded from this analysis. Percentages may not equal 100% due to rounding.

9. Financial Education Initiatives in the Workplace ©SHRM 2012 How much of an impact do employees’ personal financial challenges have on their overall employee work performance? 9 Note: n = 424. Percentages may not equal 100% due to rounding.

10. Financial Education Initiatives in the Workplace ©SHRM 2012 What aspects of overall employee work performance are MOST negatively affected when employees face personal financial challenges? 10 Note: n = 341. Only respondents whose organizations indicated that personal financial challenges have “a large impact” or “some impact” on overall employee work performance were asked this question. Respondents who answered “Not sure” were excluded from this analysis. Percentages may not equal 100% due to multiple response options.

11. Financial Education Initiatives in the Workplace ©SHRM 2012 Compared with five years ago, are employees at your organization currently faced with more or fewer personal financial challenges? 11 Note: n = 387. Respondents who answered “Not sure” were excluded from this analysis. Employees are currently faced with fewer personal financial challenges compared with five years ago

12. Financial Education Initiatives in the Workplace ©SHRM 2012 Does your organization currently provide any kind of financial education to your employees? 12

13. Financial Education Initiatives in the Workplace ©SHRM 2012 Does your organization currently provide any kind of financial education to your employees? Smaller organizationsLarger organizationsDifferences based on organization staff size 1 to 99 employees (36%)2,500 to 24,999 employees (72%)Larger organizations > smaller organizations 13 Comparisons by organization staff size Larger organizations (2,500 to 24,999 employees) are more likely to provide financial education to their employees than smaller organizations (1 to 99 employees).

14. Financial Education Initiatives in the Workplace ©SHRM 2012 Do organizations plan to provide financial education to their employees within the next 12 months? 14 Note: Only respondents whose organizations did not offer financial education to their employees were asked this question.

15. Financial Education Initiatives in the Workplace ©SHRM 2012 15 What type of financial education do organizations offer to their employees? 2011 (n = 219) 2009 (n = 255) Access to an employee assistance program (EAP) that includes financial counseling/resources 79%73% Education limited to use of employer-provided benefits (retirement, medical insurance, FSA) 68%65% Education limited to financial decisions related to retirement47%43% Education on financial topics beyond employer-provided benefits and retirement, such as budgeting, paying for education, debt reduction or credit card use, homeownership and taxes 39%33% Other3%1% Note: Only respondents whose organizations offered financial education were asked this question. Percentages may not equal 100% due to multiple response options.

16. Financial Education Initiatives in the Workplace ©SHRM 2012 What type of financial education do organizations offer to their employees? Publicly owned for-profit organizations Nonprofit organizationsDifferences based on organization sectors 51%80%Nonprofit > publicly owned for-profit 16 Comparisons by organization sector Nonprofit organizations are more likely to offer financial education topics that are limited to employer-provided benefits, compared with publicly owned for-profit organizations.

17. Financial Education Initiatives in the Workplace ©SHRM 2012 17 How do organizations provide financial education to their employees? 2011 (n = 219) 2009 (n = 256) Voluntary seminars during work hours using outside speakers (such as a “lunch and learn”) 60%57% New-hire employee orientation44%47% Information on organization’s intranet40%42% In-house newsletter25%30% Voluntary seminars outside of work hours22%15% Voluntary seminars during work hours lead by trained, in- house staff 17%31% Mandatory seminars/training11%17% Other9%2% Note: Only respondents whose organizations offered financial education were asked this question. Percentages may not equal 100% due to multiple response options.

18. Financial Education Initiatives in the Workplace ©SHRM 2012 How do organizations provide financial education to their employees? Publicly owned for-profit organizations Nonprofit organizationsDifferences based on organization sectors 40%74%Nonprofit > publicly owned for-profit 18 Comparisons by organization sector Nonprofit organizations are more likely than publicly owned for-profit organizations to provide financial education through voluntary seminars during work hours using outside speakers. Comparisons by organization size Larger organizations are more likely than smaller organizations to provide financial education through the organization’s intranet. Smaller organizationsLarger organizationsDifferences based on organization size 1 to 99 employees (18%) 500 to 2,499 employees (28%) 2,500 to 24,999 employees (63%)Larger organizations > smaller organizations

19. Financial Education Initiatives in the Workplace ©SHRM 2012 In the past 12 months, has your organization seen an increased demand for financial education from employees? 19 Note: Only respondents whose organizations offered financial education were asked this question.

20. Financial Education Initiatives in the Workplace ©SHRM 2012 As you plan your budget for next year, are you requesting funds for financial education? 20 Note: Only respondents whose organizations offered financial education were asked this question.

21. Financial Education Initiatives in the Workplace ©SHRM 2012 Has your organization conducted a needs assessment (including surveys, focus groups, etc.) to determine what topics or delivery methods of financial education would be most beneficial to your employees? 21 Note: Only respondents whose organizations offered financial education were asked this question.

22. Financial Education Initiatives in the Workplace ©SHRM 2012 Has your organization’s financial education initiatives faced any obstacles? 22 Note: Only respondents whose organizations offered financial education were asked this question.

23. Financial Education Initiatives in the Workplace ©SHRM 2012 23 What is the biggest obstacle that your financial education initiatives face? Organizations that currently offer financial education Organizations that do not currently offer financial education 2011 (n = 48) 2009 (n = 171) 2011 (n = 150) 2009 (n = 132) Cost of providing financial education33%25% 27% Lack of interest among employees25%37%23%19% Lack of support from organization’s leaders8%11%15%14% Concern about perceived violation of fiduciary duty if providers of financial education (i.e., outside providers) are not objective* 6%11%9%14% Lack of need in your workplace6% 8%17% Not sure how to create or find financial education resources4%8%14%7% Other17%2%6%2% Note: An asterisk (*) indicates that the survey choice was changed from “outside presenters” in 2009 to “providers of financial education (i.e., outside providers)” in 2011.

24. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Employee Generations 24 Note: n = 426. Percentages may not equal 100% due to multiple response options. Respondents were asked to select up to two generations that primarily represented their workforce.

25. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Employee Gender 25 Note: n = 425. Percentages may not equal 100% due to rounding. Percentages may not equal 100% due to multiple response options.

26. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Organization Industry 26 Percentage Manufacturing 19% Health care and social assistance 15% Other services except public administration 13% Professional, scientific and technical services 11% Finance and insurance 10% Educational services 9% Retail trade 5% Transportation and warehousing 5% Accommodation and food services 4% Construction 4% Public administration3% Administrative and support and waste management and remediation services3% n = 416. Percentages may not equal 100% due to multiple response options.

27. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Organization Industry (continued) 27 n = 416. An asterisk (*) indicates < 1%. Percentages may not equal 100% due to multiple response options. Percentage Arts, entertainment and recreation3% Religious, grant-making, civic, professional and similar organizations3% Utilities3% Information, publishing industries2% Wholesale trade2% Real estate and rental and leasing1% Repair and maintenance1% Management of companies and enterprises1% Mining* Personal and laundry services* Agriculture, forestry, fishing and hunting0% Private households 0%

28. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Organization Sector 28 Note: n = 415. Percentages may not equal 100% due to rounding.

29. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Organization Staff Size 29 n = 408

30. Financial Education Initiatives in the Workplace ©SHRM 2012 Demographics: Other 30 Does your organization have U.S.-based operations (business units) only or does it operate multinationally? U.S.-based operations only77% Multinational operations23% n = 423 Is your organization a single-unit company or a multi- unit company? Single-unit company: A company in which the location and the company are one and the same 37% Multi-unit company: A company that has more than one location 63% n = 423 Are HR policies and practices determined by the multi-unit corporate headquarters, by each work location or both? Multi-unit headquarters determines HR policies and practices 67% Each work location determines HR policies and practices 2% A combination of both the work location and the multi-unit headquarters determine HR policies and practices 31% n = 278 HR department/function for which you responded throughout this survey Corporate (companywide)67% Business unit/division16% Facility/location16% n = 279

31. Financial Education Initiatives in the Workplace ©SHRM 2012  Response rate = 15%  Sample composed of 458 randomly selected HR professionals from SHRM’s membership  Margin of error +/- 5%  Survey fielded December 21, 2011 – January 9, 2012 31 Methodolog y For more poll findings, visit www.shrm.org/surveyswww.shrm.org/surveys Follow us on Twitter: http://twitter.com/SHRM_Researchhttp://twitter.com/SHRM_Research SHRM Survey Findings: Financial Education Initiatives in the Workplace