July 23, 2025
How Do Employees Really Feel About Retirement and Retention?
While most working Americans recognise the value of employer-sponsored retirement plans, fewer feel confident in their financial futures. A recent survey by Voya Financial revealed that 90% of benefits-eligible employees with a retirement plan understand the tax advantages of contributing, and more than 80% believe benefits play a key role in retirement readiness. Yet, only 65% feel they’re actually on track to retire at their target age.
“Even when individuals do everything right — contributing to retirement plans, understanding tax advantages and engaging with employer benefits — they still feel as though they are falling behind,” said Kerry Sette, VP, head of Consumer Insights & Research at Voya Financial. “This is especially true for women; caregivers; individuals who are Asian, Black/African American and Hispanic/Latino; along with younger generations, all of whom are navigating systemic challenges and economic pressures that make it more challenging to build long-term financial security.”
That demand is particularly urgent among younger workers and historically underserved communities. According to the research, 82% of Gen Z and 71% of Millennials say they need help improving their financial wellness. In contrast, only 45% of baby boomers say the same. The need is also more pronounced among individuals who identify as Asian, Black/African American, or Hispanic/Latino (76%) compared to their white peers (56%).
Women are also feeling more financial strain. Nearly 9 in 10 women (88%) say their money doesn’t stretch as far as it used to, compared to 81% of men. These findings underscore the urgent need for inclusive, equitable support systems in the workplace, ones that take into account the lived financial realities of diverse employee groups.
From Paychecks to Purpose
Traditional levers for retention, like salary, are no longer enough to keep top talent. Voya’s study shows that today’s workers weigh flexible schedules (66%) and employer-sponsored retirement plans (65%) nearly as heavily as they do compensation (69%) when deciding whether to stay with an employer. What’s emerging is a workforce that values holistic, life-encompassing support, benefits that extend beyond the office and into financial, mental, and emotional well-being.
Financial pressure is also surging across all demographics. Within just three months, the percentage of Americans feeling uncertain about their finances jumped from 64% to 70%, while those experiencing frustration rose from 59% to 65%. Meanwhile, positive emotions like optimism and confidence are slipping, now at just 43% and 36%, respectively. These stressors are even more intense among women and caregivers, who report significantly more negative financial emotions than their male and non-caregiving counterparts.
For younger generations, the numbers paint a concerning picture: 75% of Gen Z and 66% of Millennials say they don’t fully understand how much to save for retirement, compared to just 40% of baby boomers. Debt remains a top barrier, with two-thirds of younger workers saying it’s preventing them from saving effectively. Emergency savings have also taken a hit, with 74% of Gen Z and 70% of Millennials reporting they’re saving less than they did a year ago.
Culture as a Retention Strategy
Today’s younger employees are looking for purpose. Voya’s data reveals that 60% of Gen Z and 57% of Millennials would be more likely to stay at a job where the company fosters a culture of inclusion and belonging. In fact, this desire for meaning and community is on par with their need for robust mental health benefits, valued by 67% of Gen Z and 59% of millennials.
Employers need to attract and retain top talent, especially among younger and more diverse groups, organisations must provide more than traditional compensation. Workers want benefits that reflect their whole lives, from financial literacy and flexible hours to inclusive workplaces and purpose-driven missions.
