Employers invest significant time and resources into building benefits packages designed to support employees’ health, financial wellbeing, and long-term security, but offering great benefits doesn’t automatically mean employees will use them.
For HR and benefits leaders, that creates an important challenge: How do you turn benefits availability into engagement and utilization?
The key is making the benefits you already provide easier to understand, more relevant to individual employees, and easier to act on.
Benefits Utilization Is More Than an Enrollment Metric
For employers, benefits utilization can reveal much more than whether employees elect or access a particular benefit.
It can provide insight into whether employees understand the resources available to them, whether those resources align with their needs, and whether the overall benefits experience is making it easy for employees to take action.
Low utilization doesn’t necessarily mean a benefit isn’t valuable. It may point to other barriers: employees may not know the benefit exists, understand when to use it, see how it applies to their situation, or know where to go for help.
Looking at utilization through this broader lens can help HR and benefits teams ask more strategic questions: Are employees finding value in the programs we’re investing in? Where are they encountering friction? Are certain resources reaching the employees who could benefit from them? Are our benefits ultimately supporting the outcomes they were designed to address?
Understanding what stands between employees and the benefits available to them is an important place to start.
Why Don’t Employees Use Their Benefits?
Low benefits utilization rarely comes down to a single issue. Employees may not know what’s available, understand how a benefit applies to them, know how to access it, or recognize why they should use it in the first place.
Several barriers can contribute to the gap between benefits availability and utilization:
1. Benefits Can Be Difficult to Understand
Employee benefits are inherently complex.
Employees may need to compare healthcare plans, understand deductibles and out-of-pocket costs, decide whether to contribute to an HSA or FSA, evaluate insurance options, make retirement elections, and navigate voluntary benefits, all while trying to understand how those decisions affect their broader financial lives.
Simply providing information doesn’t necessarily eliminate that complexity. In fact, MetLife research found that only 57% of employees fully understand what their benefits cover, while 72% want their employers to provide benefits communications tailored to their needs.
Long benefits guides, webinars, FAQs, and enrollment portals can be useful resources, but employees still bear the task of determining what all that information means for their individual circumstances. Most employees don’t have time to seek out information on their own, and if they do take time to compare and understand their options, they may not have the knowledge to confidently make choices that best suit their needs.
The challenge isn’t always a lack of information; often, it’s a lack of relevant guidance.
2. Employees May Not Know What’s Available
Benefits communication tends to receive the most attention during new-hire onboarding and open enrollment. But between annual enrollment periods, employees’ needs often change.
An employee may not pay much attention to an HSA until healthcare expenses become a priority. Financial coaching might suddenly become relevant when they’re trying to buy a home. Retirement resources may become more important after a career milestone or major life event.
If employees only hear about these resources once or twice a year, they may not remember what’s available when the need actually arises. (LIMRA’s 2026 research found that 45% of employees only hear about their benefits during annual open enrollment, even though 73% would actually prefer to receive benefits information several times throughout the year.)
Creating year-round benefits engagement can help employees discover and revisit resources when they’re most relevant. For example, employers can connect benefits communications to key moments throughout the year, highlighting tax and financial planning resources during tax season, retirement and savings support around Financial Awareness Day, or relevant benefits guidance when employees experience major life events.
3. One-Size-Fits-All Communication Doesn’t Reflect Individual Needs
Today’s workforce spans different generations, incomes, family structures, life stages, and financial circumstances. That’s why broad, generic benefits communication doesn’t resonate as effectively with employees as personalized communication.
A Gen Z employee paying down student debt may have very different priorities from a Millennial balancing childcare and housing expenses or an older employee preparing for retirement.
When employees receive broad communication about every available benefit, they have to determine for themselves which information matters.
Personalized benefits communication can reduce that burden by helping employees identify resources that align with their individual needs and goals. For example, an employee focused on paying down student loans might receive information about student loan support and financial coaching, while an employee preparing to start a family could be directed toward healthcare benefits, parental leave resources, and guidance on adjusting their financial plan.
4. Too Many Systems Can Create Friction
Even when employees know which benefits they want to use, accessing them isn’t always simple.
Benefits may be spread across multiple platforms, providers, portals, and communications, adding complexity to the employee benefits experience. Employees may have to remember where to log in, which vendor provides which service, or where to find answers to specific questions. Each additional step creates friction.
5. Employees May Not Know What to Do Next
Knowing a benefit exists and knowing how to use it effectively are two different things.
An employee may know their organization offers a 401(k), for example, but still wonder how much they should contribute. They may know an HSA is available without understanding how it fits into their healthcare and savings strategy.
Financial education can help explain how benefits work. Personalized guidance goes one step further by helping employees understand how those benefits fit into their broader financial picture.
That connection can turn awareness into action by giving employees more clarity and confidence to use their benefits.
How Can Employers Improve Benefits Utilization
Improving benefits utilization doesn’t necessarily require adding more programs. Often, the greater opportunity is helping employees get more value from what’s already available.
Here are several ways employers can help close the gap between benefits access and benefits engagement:
Provide Personalized Benefits Guidance
Employees are more likely to recognize the value of a benefit when they understand how it relates to their own goals and circumstances.
Instead of requiring employees to sort through every available resource, personalized guidance can help surface the benefits, education, and next steps that may be most relevant to them.
AI-powered tools are creating new opportunities to provide this type of personalization at scale. Employees can receive more contextual guidance based on their questions, priorities, and life stages without HR teams having to manually personalize every interaction.
For more complex decisions, access to financial professionals can complement digital support with individualized expertise.
Connect Benefits to Employees’ Financial Lives
Workplace benefits don’t exist in isolation.
A retirement plan affects long-term savings. An HSA connects healthcare decisions with financial planning. Insurance can help protect against financial risk. Equity compensation may influence taxes, investing, and long-term wealth.
Helping employees understand these connections can make benefits feel more relevant.
A holistic financial wellness program can give employees a clearer view of how their workplace benefits fit alongside their income, spending, debt, savings, and financial goals. That support is especially important when employers may not have a complete picture of employees’ financial wellbeing. (Bank of America’s 2026 Workplace Benefits Report highlights this gap, revealing that while 55% of employees rated their financial wellness as good or excellent, employers estimated that 71% of their employees were financially well.)
Instead of asking, “What benefits do I have?” employees can begin answering a more useful question: “How can I use these benefits to support what I’m trying to accomplish?”
Communicate Benefits Throughout the Year
Open enrollment is an important moment for benefits, but it shouldn’t be the only time benefits are highlighted.
Year-round communication gives employers opportunities to introduce resources when they’re most relevant. Communications can align with tax season, financial awareness initiatives, retirement planning, healthcare decisions, major life events, or other moments when employees may be more likely to take action.
The goal isn’t necessarily to communicate more frequently. It’s to communicate more intentionally.
Timely, targeted communication can be more useful than repeatedly sending the same information to the entire workforce.
Make Benefits Easier to Navigate
Reducing friction is another important part of improving benefits utilization.
Employees should be able to easily understand what resources are available, where to access them, and what to do next.
Bringing financial wellness education, benefits information, personalized guidance, and relevant resources into a more connected experience can reduce the burden on employees to piece everything together themselves.
It can also reduce repetitive benefits questions for HR by giving employees a clearer path to answers and support.
Measure Impact, Not Just Participation
Improving benefits utilization also requires understanding whether your strategy is working.
Logins, clicks, webinar attendance, and enrollment numbers provide useful information, but they don’t tell the entire story.
HR and benefits leaders can also consider questions such as:
- Are employees returning to use available resources?
- Are they taking meaningful financial actions?
- Are employees engaging with benefits relevant to their needs?
- Is financial confidence improving?
- Where are employees still encountering friction or confusion?
Aggregated and anonymized workforce insights can help employers identify engagement patterns, uncover areas where additional support may be needed, and make more informed decisions about their benefits strategy.
This shifts the conversation from “Did employees use the program?” toward “Is the program helping employees make progress?”
From Benefits Utilization to Benefits Impact
A strong benefits strategy isn’t defined by how many programs an employer offers.
It’s defined by whether those programs are understood, relevant, accessible, and ultimately useful to employees.
Improving benefits utilization starts by removing the barriers that stand between employees and the resources already available to them. That means simplifying complexity, providing personalized guidance, communicating throughout the year, creating a more connected experience, and measuring whether programs are actually making an impact.
For employers, the opportunity isn’t simply to drive more clicks or enrollments. It’s to help employees get greater value from benefits investments while creating an experience that better supports their financial wellbeing.
Remember: the true value of a benefit isn’t realized when it’s offered; it’s realized when employees can confidently use it.
