It has been studied that with the onset of 2017, more and more employers have started addressing their financial wellness beyond retirement to produce a happier and healthier life beyond retirement. Although there is increased participation in workplace retirement accounts like 401(k), yet they don’t seem to be satisfied with their employee savings rates. This is a finding which has come from one of the latest studies by Aon Hewitt. The firm also revealed that 92% of the employers are worried about whether or not their employers have a clear understanding of how much the employees should save.
There are predictions of an increase of financial wellness programs beyond retirement decisions in 2017 to include things like budgeting, financial literacy, financial planning and debt management. Take a look at some points which retirement plan advisors should keep in mind.
Growing interest among employees
As mentioned above, Aon Hewitt’s report found 60% of the employers to already offer assistance in at least a single category which falls under the category of financial wellbeing. By the end of 2017, this percentage is predicted to grow to about 85%. More than half of the employees show tendencies of being extremely concerned about their financial well-being and this figure saw a 10% increase from 2015 which topped employer initiatives in 2016. As more employers bring physical wellness initiatives in their program.
Interest among financial advisors are also growing
For some financial advisors, offering financial wellness programs to companies has become the main factor that can cause differences in doing business. As per a survey from ADP, it was found that while just 24% of advisors work along with employers with regards to financial wellness programs, yet another 48% are already considering it. Financial advisors need to stay in tune with the focus of the client. When an advisor is measuring the success on the replacement income ratio of the participant, not being able to adopt some kind of wellness initiative can hurt your performance rating.
No matter how much the financial advisor helps the employees, can they prove that such initiatives are all worth the effort of investing in them? When you assume a particular company’s benefits, this can automatically persuade the CFO of a company to adopt some program in either 6-12 months and the CFO will probably seek proof of his payoff. How well is the financial well-being program working? How are participants adopting it? Is it changing the way in which employees behave?
So, we see that the employers are gradually making retirement readiness one of the vital parts of their fiscal wellbeing strategy by offering modelers and tools to help workers understand everything realistically how much exactly they would need to retire. Aon Hewitt’s 2017 Hot Topics in Retirement and Financial Wellbeing surveyed around 250 US employers who represented around 9 million workers to analyze the priorities and the possible changes with regards to retirement benefits.
Image source: https://pixabay.com/en/grandparents-grandmother-people-1969824/