Workers consider healthcare coverage a more attractive employee benefit than 401(k)s.
Currently, the U.S. is suffering through a retirement crisis where millions of employees lack the savings and assets to retire comfortably. Given this, you would assume that employers offering 401(k)s would be sought after by workers looking for a new job. However, survey data shows that workers are actually more concerned with employer-offered health insurance than any other employee benefit. But why do workers consider healthcare coverage a more attractive employee benefit than 401(k)s? Here’s what you need to know.
One of the main reasons why employees are more likely to make job decisions based on health coverage is because they do not have a thorough understanding of 401(k)s. In fact, less than 50% of employees report that they completely understand what 401(k)s do.
Additionally, many employees also have limited knowledge when it comes to their health benefits. Less than 1/3 of employees report that they understand their plan type, and certain plans, such as high-deductible health plans (23%) and health reimbursement accounts (less than 20%), are even more confusing to employees.
Because most employees do not fully understand their employee benefits, they fail to make the most of them. For instance, many employees fail to recognize the full value of a position offering 401(k) matching and the impact that such a benefit will have on their financial future. Additionally, many employees simply choose positions that offer health insurance, assuming that this benefit will cover all their medical expenses. Oftentimes, they are surprised by high co-pays or are unaware of how much of their paychecks are being diverted to cover their health plan.
The best way to ensure that workers are making informed financial decisions is by educating them on what different employee benefits actually mean for their current and future financial state. It is only when employees are given accurate and comprehensive information that they are empowered to make informed job decisions.
This is why many workers consider healthcare coverage a more attractive employee benefit than 401(k)s. Want to offer your staff the benefits that they deserve? If so, then contact the experts at CIA Insurance and Risk Management for assistance today.
Post written by Janelle Morck, Vice President | Employee Benefits Risk Management (ERM)
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