Education & Financial Wellness – Roles in a retirement plan

There are many factors that come into play for plan sponsors when designing and maintaining a successful retirement plan for your employees. Things like oversight, plan design, provider coordination, payroll processing, and continuous decision making – the list goes on and on.  All the day-to-day “stuff” often overshadows two very important aspects to your retirement plan; education and financial wellness.  Topics that should not be taken lightly. Education and financial wellness for employees should be top of mind for all employers!  A new study finds that the ongoing economic environment continues to heighten pressures for employees, who are turning their attention to their employer benefits for educational support.

So why is education and wellness so important in your retirement plan?

1. We want to help employees to retire at a reasonable age.

2. It’s important for employees to make good financial and life decisions. This benefits them at home and at work. According to Morgan Stanley At Work’s third annual State of the Workplace, employees and HR leaders agree that financial stress affects job performance. In fact, 83% of HR leaders worry that financial issues could impact their employees’ productivity and 63% of employees agree that financial stress is negatively impacting their work and personal life.

3. A retirement plan with good benefits and resources can drive retention.

4. Employees need help. Nearly 3 of 5 employees have ranked the need for retirement assistance from financial professionals as a main factor when choosing where to work.

What topics should be covered for employees?

  1. Roth.  We expect to see more usage of Roth in the near future.  Do employees understand the difference between Roth and Traditional contributions?
  2. Catch-up contributions and how they work.
  3. Tools, tools, and more tools!  Financial calculators, retirement projections, and educational videos can all be extremely useful for employees.
  4. Investment education and information regarding the retirement plan.

How should education and wellness be delivered to participants? 

1. Website – outside website or intranet

2. Email – keeping in touch with employees is key.

3. Webinars

4. Face-to-face interaction

Your organization’s retirement plan is complex, full of ever-changing details, regulations, and oversight.  We have built our reputation on understanding those complexities and helping plan sponsors build strong retirement plans.  Reach out to our friendly team – we are experts at taking a retirement plans’ most complex elements and simplifying them.  We will tell you what you need to know, why and what you should do.

Sean Duffy, QPFC, AIF®
Investment Consultant