American workers are feeling more confident about their financial wellbeing: BofA

Concern about current conditions weakening retirement savings has eased.

Sentiment among U.S. workers about their financial wellbeing has improved in 2024, according to new research from Bank of America.

The share of respondents to the firm’s 14^th annual Workplace Benefits Report who feel financially well has increased by five percentage points to 47%, while the cohort who are concerned about the current economic conditions impacting their long-term retirement savings has fallen 10 points to 53%.

The number of employees prioritizing long-term retirement savings is slowly trending upwards (33% today, up from 31% in 2023). This has become their top financial goal, overtaking those focused on short-term financial needs last year.

The report, produced in collaboration with the Bank of America Institute, also highlights the growing gap between how men and women feel about their finances. While 53% of men say they have good financial wellness, this falls to just 36% among women.

However, 76% of all respondents said that the cost of living is outpacing wage or salary growth, up from 67% in June 2023. This is leading them to take proactive action such as limiting expenses (62%), reducing debt (43%), and boosting emergency funds (41%).

Although compensation remains the number one reason cited by poll participants who plan to quit their current job (52%), with career progression second (45%), most people (70%) plan to stay with their current employer for the next year, with work/life balance the reason cited by two thirds.

For businesses trying to attract talent, addressing the gender pay gap pays dividends with 78% of employers who have initiatives in this regard reporting improved talent attraction compared to 50% of those who do not.

Workers with retirement savings plans need a reality check on the potential of health care costs. Just 7% think this cost would be as much as $10K despite Employee Benefits Research Institute calculations that puts the total retirement health care costs of a 65-year-old couple at $350,000.

Other findings include that 61% of caregivers are not aware that their employer has support for them, even though 81% of employers say they do and 52% of employee respondents say they are caregivers.