By Cyril Tuohy
Large employers, many of whom have established the concept of wellness as a way to lower medical expenses, are extending the idea to the financial and retirement well-being of employees with the help of tools, information and access to advisors in 2014.
The findings are included in the latest retirement survey by the benefits broker Aon, which found that many companies are planning to make it easier for workers to have access to financial advice from a professional.
Already, 44 percent of companies provide online third-party investment advisory services to workers, 35 percent offer workers access to advice through the telephone, and 23 percent of companies allow for face-to-face meetings with advisors, Aon said.
Companies are also planning to help employees in financial day-to-day areas. In 2014, as many as 25 percent of employers are “very likely” to offer help with budgeting to ensure paychecks cover expenses, with the goal of helping employees set aside money for savings.
The findings are contained in Aon’s “2014 Hot Topics in Retirement” survey report, which highlights issues that are at the top of mind for employers.
“As plan sponsors enter 2014 they are building on the success of the prior year and placing an emphasis on fitting retirement programs into broader strategic goals for their organization,” said Aon’s director of retirement research, Rob Austin.
Surveys of American consumers have repeatedly found that many are seriously lacking when it comes to financial literacy and budgeting, and the survey reveals how far some companies are willing to help their employees with the their daily challenges of paying for current expenses and setting aside enough to cover future expenses.
The survey, which includes responses from more than 400 employers representing nearly 10 million employees, also found that 63 percent of employer-sponsored retirement plans have modeling tools within their defined contribution plan to help employees adjust savings habits and tinker with different time horizons.
Internet-based algorithms have made it easy for employees to see how changes in financial levers affect the level of assets they own in the future. Often, the larger the employer, the more tools are available to employees.
One-third of plan sponsors are reviewing retirement fund options they offer employees in an effort to keep fees within acceptable limits, the survey also revealed, and more than 15 percent of plan sponsors are changing their approach from one offering an array of funds managed by a mutual fund company to one where funds are managed by separate institutions, the survey found.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at firstname.lastname@example.org.
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