Data Points | PLANADVISER November/December 2016

Providing Participants With Access to Financial Education

Employees want help learning to make decisions about money

By PA | November/December 2016

The 2016 PLANSPONSOR Participant Survey found that Millennials, Generation X and Baby Boomers have different needs and expectations regarding retirement. Not surprisingly, younger employees, who are likely to be battling competing financial priorities, save less than do older employees, who may be trying to catch up on their retirement savings.

There are varying approaches to how to best communicate with participants to help them save adequately and improve their retirement outcomes. The industry appears to be embracing a holistic and wellness-based approach to education instead of the traditional investment-focused communication.

The good news is that younger employees under the age of 30 are more interested in learning how to improve financial outcomes—e.g., 44.6% “agree” that they would like to receive more financial education at work. But it can be challenging to reach this group in large scale, as only 34.9% say they “usually” or “always” read plan communications, vs. 54.2% of pre-retirees 50 and older.

While two of every five retirement plan participants (39.0%) would like their employer to offer more financial education at the workplace, employees without access to a defined contribution (DC) plan were almost twice as likely to wish the same (66.7%).

With financial wellness such an important issue, the 2016 PLANSPONSOR Defined Contribution Survey asked which topics sponsors cover in their participant education campaigns. The top five were investment basics and strategies (51.7%), saving and budgeting (36.0%), retirement health care costs (19.9%), Social Security withdrawal strategies (17.1%) and managing credit and debt (16.1%).

Opens/Reads Plan Communications
Want More Financial Education at Work
Want More Financial Education at Work
General Education Offered on Financial Topics