Survey: Diverse structures point to a more tailored approach in family benefits packages

Originally posted May 22, 2014 by Nick Otto on https://ebn.benefitnews.com.

Even against the backdrop of a stronger economy, modern families are still feeling the pinch of financial security, pointing toward the need to tailor products to the needs of specific family structures that are considerably different than the traditional nuclear family.

As a result, the increased diversity will require more comprehensive offerings on the part of benefits managers hoping to provide the best to an increasingly diverse workplace.

Traditional families — or those married to someone of the opposite gender with at least one child younger than 21 — were found to have fewer struggles with financial security than their modern blended, multi-generational or same-sex counterparts. Nearly 36% of modern families were reported to have collected unemployment versus 21% of traditional families, according to a recent report from Allianz.

The LoveFamilyMoney Study analyzed the financial security of a more diverse household landscape. According to the report, only 19.6% of today’s households constitute a “traditional” family, a drop from 40.3% in 1970.

The study included:

▪       Multi-Generational Families — Three or more generations living in the same household.

▪       Single Parent Families — One unmarried adult with at least one child younger than 18.

▪       Same-Sex Couple Families — Married or unmarried couples living together with a member of the same gender.

▪       Blended Families — Parents who are married or living together with a stepchild and/or child from a previous relationship.

▪       Older Parent with Young Children Families — Parents age 40+ with at least one child younger than 5 in the household.

▪       Boomerang Families — Parents with an adult child (21-35) who left and later returned to rejoin the family.

Each structure brings different dynamics to the inner workings of the family, Allianz says. For example, while traditional families provide hierarchy, collaboration and structure; boomerang families, while closely traditional, view their adult children more as friends.

Additionally, the study notes, only 30% of modern families feel financial secure, unlike 41% of traditional families. For example, twice as many modern families say they have declared bankruptcy — 22% compared with 11% of traditional families.

“New family structures have a direct impact on a family’s relationship with money and finances—and we found that, while modern families have similar strong emotional ties, they often feel financially less secure than their traditional counterparts," said Katie Libbe, Allianz Life vice president of Consumer Insights.

"While family structure plays a prominent role, our study of these different modern family cohorts uncovered a number of unique insights into each group’s attitudes, perceptions and beliefs around money and financial planning," she adds.

Although most employees understand the need for medical and dental insurance, the value of voluntary benefits is less understood and can open doors to the modern family structures seen in today’s society. Voluntary products are changing the employee benefits game and can help employers meet objectives while providing more choices for employees.


Employees Placing Greater Reliance on Benefits

By Brian M. Kalish

Tough times have employees placing greater reliance on benefits for financial security, as employers affirm their commitment to sponsoring those benefits albeit with increased cost sharing.

That’s one upshot from the 10th Annual MetLife Annual Study of Employee Benefits Trends released Monday. It found that since 2002 employer’s top benefits objectives -- controlling costs, attracting and retaining employees and increased productivity – have remained fairly constant. However, some delivery aspects have changed, such as the growth of auto-enrollment features in 401(k) plans. For advisers, the trends seem to point toward stable expenditures for core benefits, but greater funding from employees, including voluntary benefit purchases.

Nearly half of the 1,412 employees surveyed said that, because of the economy, they are counting on their employer to help them achieve financial security through employee benefits such as disability and life insurance and health.

For younger generations, that number is even higher. More than half (55%) of Gen X and two-thirds of Gen Y workers said economic pressures leave them counting on employers’ benefits program to help with their financial projection needs, according to the study, presented by MetLife’s National Medical Director Dr. Ron Leopold, an EBA Advisory Board member, at a MetLife Symposium in Washington.

Employers say they are hearing these concerns and rising to the challenge. Regardless of company size, of all companies surveyed, only 10% said they planned to reduce their benefits.

“The workplace has changed rather dramatically over the last decade since MetLife began doing its annual study,” says Anthony Nugent, executive vice president of MetLife.  “Ten years ago, many Baby Boomers were planning to retire at age 65, Gen Y workers were just entering the workplace, and communication vehicles like Facebook and Twitter didn’t exist.”

As employees rely more on benefits, they are willing to bear most of the cost of them. Of surveyed Gen X and Gen Y employees, 62% said they are willing to bear more of the cost of their benefits rather than lose them.

And that may happen. While a third of employees believe their employer is likely to soon cut benefits, 70% of surveyed employers said they intend to maintain their current level of employee benefits. However, 30% will do this by shifting costs to employees.  Some 57%, are interested in a wider array of voluntary benefits offered by their employer, as compared to 43% of Baby Boomers.  The study also found that employers recognize this interest as 62% of employers agree that in the next five years employee-paid benefits will become a more important strategy than they are today.

With the ever-changing benefit landscape, loyalty continued to fall. Only half (42%) of employees feel a strong sense of loyalty to their employer, a seven-year low. Conversely, 59% of employers said they feel a very strong sense of loyalty to employees. One in three people would like to work for a different employer in 2012, but that number climbs to one in two for Gen Y employees.