A growing number of employers are concerned about the financial well-being of employees—and employees want more financial guidance. Retirement plan sponsors have a bigger role to play!
Overall Financial Well-Being Programs
Bank of America’s 2020 Workplace Benefits report found that 62% of employers feel “extremely” responsible for the financial wellness of their employees. This is a leap from 2013, when only 13% of employers felt this level of responsibility. (Read the full report here.)
The pandemic has increased financial stress—and benefits professionals can respond with increased programming. As a new report from T. Rowe Price Insights on Retirement advises:
Times of crisis often serve to crystalize thoughts and spur action. In that vein, the coronavirus pandemic has served as a catalyst to advance ongoing conversations between retirement and benefits professionals and their service providers. The result is increased interest in adopting programs that can directly address the root causes of financial hardship and provide programmatic remedies such as emergency savings, debt management, and other financial wellness programs that can serve both an employer’s and their employees’ longterm best interests.
Share Information and Access Advice
Most employees don’t have financial advisors. Lack of guidance is a common roadblock to increased financial well-being. Often, trusted sources of financial guidance are the employer and retirement plan sponsors— these relationships already exist. In fact, according to T. Rowe Price Insights:
Between 40–60% of the workers surveyed expressed interest in receiving help from their employer or retirement plan record keeper with financial goals to determine savings goals, prioritize or track progress toward saving for retirement or college educations for their children, reduce debt, and manage day-to-day expenses.
As a Plan Sponsor, now is the time to consider more ways to access and share information to help employees with their financial decisions. What additional information, workshops, and financial services can your company and 401(k) provider offer?
Promote Trust: Remember ERISA!
As a you encourage employees to plan for retirement, you also need to assure them that the money in the retirement account is protected. Make sure it is: check that your required ERISA fidelity bond is up to date. Obtain your ERISA Bond here now!
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