Beyond the 401(k): A Smarter Way to Support Employees’ Financial Well-Being

BY Christopher O'Keeffe | August 11, 2025

“Student debt is just the beginning,” said Jon Harold, head of sales and partnership for SoFi at Work. Harold works with many companies on student debt and has discovered that, while many provide financial well-being support for retirement, it is often treated as the final step rather than part of an ongoing journey.

But traditional retirement plans no longer cover the financial needs of today’s workforce, he says. Harold spoke during a From Day One’s webinar, where he laid out how modern financial benefits are evolving—and why employers can’t afford to rely on outdated approaches.

Harold began with a stark reality check: “Over 50% of adults are unable to afford a $1,000 emergency. And that happens all the time.” Without savings, people rely on high-interest credit cards, leading to a cycle of debt that affects every aspect of life, including work.

Given this, many Americans face stress when it comes to their finances. And this stress impacts how they’re able to show up in the workforce. The downstream effects are significant: Employees who experience financial stress are significantly more likely to leave their organization, leading to substantial lost productivity each year.

The financial picture continues to worsen. “Since the year 2000, median wages have only increased 19%—that number is adjusted for inflation,” he said. “College tuition has gone up over 80%, housing has gone up over 80%, healthcare over 140%.”

Changes in Financial Well-Being Needs

Even 401(k) plans, long considered a pillar of financial stability, are increasingly being used as a last resort. “Hardship withdrawals are running 15 to 20% above historical norms,” Harold said, referencing data from Vanguard. “4.8% of Vanguard plan participants initiated a hardship withdrawal—33% year over year.”

Jon Harold of SoFi at Work led the webinar titled, "Beyond the 401(k): Expanding Financial Benefits" (company photo)

The impact on long-term financial security is substantial. “Early withdrawals can face a 10% penalty in income tax and delay retirement, where employees may need to work longer to rebuild savings,” Harold said. “Frequent withdrawals can signal broader hardships.”

There is a notable perception gap between employees and employers regarding financial well-being support. While most employees want assistance with their financial health, only a small percentage of employers believe they are providing that help. This disconnect contributes to underutilization and weakens the intended impact of financial programs.

Harold outlined a more complete roadmap of employee financial needs: “Saving for unexpected expenses, paying off student debt, reducing your credit card debt, purchasing or refinancing a home, managing budget and credit, saving for children's education, planning for retirement, and creating an estate plan.” With many organizations employing five generations at once, needs vary, but personalization is key. 

“Gen Z at a law firm is going to be a lot different than Gen Z in a factory,” Harold said. “You want to understand those personas and the problems that they’re facing, and then think about, with those problems, what financial solutions can help solve those.” 

Designing Programs That Actually Work

“We like to think of the way that [SoFi] helps in three different buckets,” Harold said. “That is, first, leading by education. Number two is providing employees with the tools and products that they need to solve their financial needs. And then the third, which can be optional, is employers taking action with their dollars to help even more.”

On education: “People like to learn differently. Some people are hands-on, others like to read about things, [others prefer] talking to a physical human.” SoFi offers tools for all three learning types, including loan specialists, credit score monitoring, financial planners, and webinars.

Among the many offers, student debt support stands out among employers, he says. Student debt support is overlooked, but when implemented, greatly appreciated and used. “We rolled it out to a physical therapy company that was having trouble attracting clinical therapists, and they saw 40% of people participate in the first year. That participation rate is unheard of across all voluntary benefits.”

To be able to add benefits like student debt support, employers have to work toward gaining buy-in. Educating leadership requires knowing what motivates them. “Influencing has a big, big part here, and it depends how your leadership team likes to make decisions,” Harold said. “The best case is a combination of everything, of putting forth qualitative quotes from employees who are struggling, showing that in the data, showing what other companies within your industry are doing,” he said. 

Even with some benefits targeted to specific demographics, Harold advised not to let fear of “what about us?” syndrome stall action. “At the end of the day, impacting the employees who need it the most far outweighs the small minority of those who may not benefit,” he said.

While the upfront investment in financial benefits may seem daunting, Harold reminded attendees of the risk of delay: “Employees are financially stressed—it’s impacting your bottom line.” 

Editor’s note: From Day One thanks our partner, SoFi at Work, for sponsoring this webinar. 

Chris O’Keeffe is a freelance writer with experience across industries. As the founder and creative director of OK Creative: The Language Agency, he has led strategy and storytelling for organizations like MIT, Amazon, and Cirque du Soleil, bringing their stories to life through established and emerging media.

(Photo by Dacharlie/iStock)

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