Financial Wellness Needs Diverse Among Employee Groups
Financial wellness needs can be age-based, income-based, or based a
number of other factors, so any financial wellness solution needs to
address the broad spectrum of needs, says Brian Murphy with Fidelity.
Research from Fidelity Investments
reveals how retirement plan participants define financial wellness and
what they need to feel financial stability.
Based on a focus
group of 65 participants in Fidelity administered plans and a survey of
483 retirement plan participants, Fidelity found one-third had not heard
the term “financial wellness” before participating in the research.
Only 12% have heard of financial wellness at their workplace, while most
heard of it through the media or elsewhere.
Asked for
definitions of “financial wellness,” key themes emerged from
participants’ responses, including “being not stressed out about money
issues,” “having savings/emergency funds,” and “saving for the future.”
While
“not being stressed” and “being on track for retirement” were key
conditions of being financially well, being free of debt, having enough
income to cover expenses and having an emergency fund all were
secondary.
Brian Murphy, SVP of employee insights for Fidelity in
Boston, tells PLANADVISER the biggest takeaway from the survey is the
combination of the diversity of needs among participants with the
consistency of emotions.
Financial wellness needs can be
age-based, income-based, or based a number of other factors, so any
financial wellness solution needs to address the broad spectrum of
needs, he says. Murphy gave a few examples:
A worker living
paycheck to paycheck wants to be able to pay bills and have a little
left over to save or enjoy; having a budget and emergency savings is
important;
Millennials may also be living paycheck to paycheck,
balancing a desire to live in the moment with the need to look forward
to expenses such as buying a home; they need to learn how to balance
living today with saving for the future; and
Some employees make
good basic financial decisions, but they have trouble with trade-offs
between paying down debt, saving for children’s college and saving for
the future.
The key emotion for all is feeling a lack of
control over near-term decisions, a lack of confidence and a lack of
stability. Fidelity says this is true across all demographics and income
levels.
NEXT: Managing emotions and driving engagement
The overwhelming majority (83%) of participants in the study agree that being financially well helps them feel physically well.
Murphy
explains that emotions employees feel about finances turn into stress,
and if they are not brought under control, this leads to distress,
“which really becomes a problem.” The study revealed that employees do
not leave stress at door when they come to work; it remains a
distraction on the job and impacts productivity. Some employees have to
use work time to handle financial issues and some even miss days of work
to deal with them. “In addition, financial distress can lead to
physical issues as well, that turns into another impact for both
individuals and employers, so managing emotions becomes critical,” he
says.
“So financial wellness is about providing content, tools
and support to help employees make better near-term decisions. This will
help their emotional state,” Murphy adds. “Managing behavior and
emotions are equally important.”
According to the study results,
most participants are aware of financial wellness programs or resources
offered at their workplace; however, in most cases, being aware of the
programs doesn’t necessarily lead to usage.
“Engagement is one
of toughest challenges across all benefits,” Murphy notes. “We’re seeing
employers putting more emphasis on financial wellness and working with
providers to help drive engagement.”
Murphy offer four areas of best practices to drive engagement in financial wellness programs:
Personalization
– Given the breadth of employees, the financial wellness solution has
to include a broad range of needs, but participants will only engage if
they feel it is personalized to them. Murphy suggests using provider
data to make financial wellness programs relevant to each need.
Be at right place at right time
– Employees go to different places for information. Financial wellness
topics and solutions should be found on websites and blogs, for example,
so employers do not miss an opportunity to engage employees. In
addition, Murphy says, employees are more receptive to financial
education at key life moments, for example, after having a baby or
getting divorced. These are good times to engage employees.
Simple and engaging content –
most employees aren’t financial knowledge seekers, so employers need to
present content in a way that is simple, interactive and personalized
or employees won’t engage.
Employer advocacy – if the
employer is really behind the program, employees know the employer cares
and thinks financial wellness is important for them, so engagement
increases.
Fidelity anticipates a full release of study results next month.
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Ruben
Ramirez has joined Cetera Financial Group as manager
of the retirement practice consulting team. In addition to leading this team, his
responsibilities include the continued development of the Guided Retirement
Solutions tool. The retirement practice consulting team works with Cetera advisers
to help them develop and execute strategic game plans for expanding their
retirement plan businesses, and provides expertise on best practices and
product information.
George
Barker has joined Cetera as retirement plan partner relations manager. He also
manages non-strategic retirement plan product relationships and retirement plan
technology partner relationships. The retirement plan partners program helps
bring best-in-class tools and products from across the industry directly to
advisers.
Richard Gardiner has joined Neuberger Berman Trust Company as chief investment officer. He will
also lead the firm’s investment strategy group and join the firm’s asset-allocation
committee.
Gardiner will
work with Neuberger Berman's wealth advisers and trust officers on high-net-worth
individual, foundation and endowment clients. With oversight of asset
allocation, manager selection, and portfolio construction, Gardiner and the investment
strategy group will identify the most appropriate managers and investment strategies
across multiple regions.
Previously,
Gardiner was a consultant at the Reservoir Capital Group, and chief investment
officer and co-founder of an independent wealth management firm. Earlier, he
was head of arbitrage and credit at Man Investments, as well as a member of the
firm’s investment committee. Before joining Man, he was responsible for
convertible sales and trading at J.P. Morgan and at Goldman Sachs.
Erik Knutzen, chief investment officer of multi-asset
class portfolios at Neuberger Berman, lauds Gardiner’s diverse background in
wealth management and alternative investment strategies.
Gardiner calls
diversification and asset allocation critically important to clients’ goals,
and notes that global financial market volatility and changing economic
conditions have caused dramatic shifts in the risk/reward characteristics of
various asset classes. However, he says, “these obstacles can be overcome by
pairing investment goals with the right set of portfolio managers who can
execute on specific strategies utilizing a range of asset classes.”
Gardiner holds
a bachelor’s degree, cum laude, from Yale University and a master’s degree in
business administration from Harvard Business School.
Neuberger Berman
Trust Company is an affiliate of Neuberger Berman, a private, independent,
employee-owned investment manager.
NEXT:
FinMason hires former Riskalyze director as head of adviser solutions.
Mark Hollingsworth has joined FinMason as head of adviser solutions, a newly created role. He will
spearhead FinMason’s expansion into the financial adviser space.
Previously,
Hollingsworth was director of enterprise solutions at Riskalyze in Auburn,
California. Before Riskalyze, he was co-founder, president and chief executive
of NEXT Financial Group, a nationwide independent broker/dealer and investment
adviser. Prior to NEXT, Hollingsworth held positions at Wheat First Securities
(now part of Wells Fargo), Branch Cabell and Investors Security. He was also a
guest host on CNBC’s “Squawk Box” and “Taking Stock” for five years, until the
founding of NEXT.
Kendrick Wakeman, chief executive and founder of
FinMason, cites Hollingsworth for his deep knowledge and extensive background
in the investment and advisory space.
FinMason is a
Boston financial technology firm focused on investor education.
NEXT:
Putnam Investments names head of DCIO business.
Steven P. McKay has joined Putnam Investments as head of defined contribution investment only
(DCIO), overseeing all aspects of DCIO business, including small- to
large-sized plans.
Based in
Boston, McKay previously held senior positions in Putnam’s 401(k) business. He
reports directly to Jeffrey L. Gould,
head of Putnam Global institutional management, who says McKay’s experience in
the defined contribution and broader investment management sector will prove
invaluable to the DCIO unit.
McKay’s career
includes more than 20 years of senior leadership roles in defined contribution,
including positions in the investment-only and full-service areas. Most recently,
he served as vice president and sales manager of large-market DC for Empower
Retirement, responsible for managing regional sales directors and intermediary
relations team in the large-market segment.
Earlier, McKay
served as national DC sales manager for Putnam, where he oversaw the firm’s
regional 401(k) sales directors, national accounts team and internal 401(k)
sales desk. He joined Putnam in 2012 as regional 401(k) director with
responsibility for adviser/consultant-sold corporate 401(k) sales in upstate
New York and New England.
Previously,
McKay was senior divisional vice president for the Hartford Retirement Plans
Group, a role he assumed when The Hartford acquired MFS Retirement Services. He
began his financial services career at MFS, where he served for 14 years,
rising to become senior divisional vice president with responsibility for the
retirement plan wholesaling division.
McKay holds a
bachelor’s degree in business administration from Salem State University.
DCIO includes
investment options in DC plans overseen by asset managers that are not affiliated
with the plan’s recordkeeper. Industry sources estimate that the DCIO market
will increase from $3 trillion in 2015 to $4.1 trillion by 2020, according to
Putnam.
NEXT:
Creative Planning names industry pro to lead 401(k) unit.
Mike Rogers has joined Creative Planning to help lead its 401(k) division.
Rogers, who
has 27 years’ experience in retirement planning, has served in a range of capacities:
for a registered investment advisory, a third-party administrator and a recordkeeping
firm specializing in retirement plans. Previously, he was partner and head of
pension services at Burr Pilger Mayer. His expertise includes plan design,
vendor optimization and solutions for addressing fiduciary liability concerns.
He also has extensive experience in pension services, retirement plan
consulting, 401(k) advisory work, investment committee activities, retirement
plan committee charters, Employee Retirement Income Security Act (ERISA) audits and Internal Revenue Service/Department of Labor correction programs.
Peter Mallouk, president and chief investment
officer of Creative Planning, cites Rogers for his extensive background in the
401(k) industry.
Rogers is an
active member of the Western Pension Benefit Conference's Silicon Valley
Committee and the American Society of Pension Professionals & Actuaries
(ASPPA), as well as an instructor for the ASPPA, San Jose State University and
University of California Extension benefit classes.
Rogers holds a
bachelor’s degree in agricultural economics with a concentration in managerial
economics from the University of California at Davis. He holds a number of
designations, including Qualified Pension Administrator (QPA), Accredited
Investment Fiduciary (AIF) and Tax Exempt and Governmental Plan Consultant
(TGPC).
Creative
Planning is a financial adviser headquartered in Leawood, Kansas.
NEXT:Haven Financial Group opens PlanMember Financial
Center in Salem, Oregon.
Michael E. Martindale of Haven Financial Group in Salem, Oregon, has affiliated with PlanMember Securities Corporation as a
PlanMember Financial Center, expanding retirement investment planning and financial
education opportunities for educators and employees of nonprofits in Salem,
Bend, Corvallis and Eugene.
Combined with
its satellite office in Bend, Oregon, Haven Financial Group has more than $115
million of assets under management. Martindale began his financial services
career in 1980 and has been a PlanMember representative since 2011.
Jon Ziehl, founder and chief executive of
PlanMember, says the affiliation supports the firm’s expansion plans.
PlanMember, headquartered
in Carpinteria, California, is a broker/dealer and investment adviser that
provides retirement planning to the public education and non-profit sectors.
NEXT:
MassMutualappoints eight sales reps.
MassMutual Retirement Services has named eight managing directors to
support the emerging market, which targets retirement plans with up to $10
million in assets under management, and institutional plans, defined as plans
with more than $10 million in assets.
Michael Baron supports sales of retirement plans in
the emerging market in Eastern Tennessee and partners with Dan Caple, institutional markets managing director. He comes to
MassMutual with more than 10 years of experience in the financial services
industry and reports to Jason Roper,
southern division sales manager. Previously, he was a financial adviser
specializing in retirement plans, as well as regional vice president at
Nationwide Financial. Baron holds designations as a Chartered Retirement Plan
Specialist (CRPS) and an Accredited Investment Fiduciary (AIF).
Located in
Scottsdale, Arizona, Jeff Beneteau
supports the emerging market in Arizona, reports to Brian Robb, Southwest division sales manager, and partners with Scott Adams, institutional markets
managing director. After spending three years at Merrill Lynch as a financial
adviser, Beneteau joined MassMutual in 2011 as a business development
consultant, and most recently served as relationship manager for fund partners.
Beneteau holds the Chartered Retirement Plan Counselor (CRPC) designation.
Steve Carrera is based in Towson, Maryland, and
supports emerging market sales for Maryland. He reports to Bill Hicks, Mid-Atlantic divisional sales manager, and partners
with Garrett Carlough, institutional
markets managing director. Prior to joining MassMutual, Carrera served as area
sales manager for ADP Retirement Services. He has more than 17 years of
experience in the retirement plans marketplace and holds the AIF designation.
Nate Charleson supports sales in the emerging market
for Orange County, California, where he is based. He reports to Frank Bruno, western division sales
manager and partners with Francesca
Messano, institutional markets managing director. Charleson previously
spent nine years with John Hancock as a retirement plan business development
officer and internal sales consultant.
Based in
Denver, Ryan Moore supports the
emerging market in Colorado, New Mexico and Wyoming. He partners with Adams and
reports to Robb. With more than 11 years of experience in the industry, Moore
was previously regional vice president with CUNA Mutual and holds the CRPS
designation.
Based in the
District of Columbia, Jim Morris
supports emerging markets sales across the District, Montgomery County, Maryland,
and Northern Virginia. Morris reports to Hicks and will partner with Carlough.
Previously, Morris was regional vice president of retirement plan sales for the
Guardian Life Insurance Company of America and a financial adviser at Merrill
Lynch. He has 15 years of retirement plan experience.
Based in Cedar
Rapids, Philip Saxon supports sales
of retirement plans in the emerging market in Iowa. He partners with Brad Harrison, managing director of institutional
markets and reports to Vince Rainforth,
Central division sales manager. Saxon has 12 years of experience in retirement
plan sales, most recently as director of internal sales for Transamerica.
Emma Tookey is based in Berkeley, California, and
supports the Northern California/Pacific Northwest regions, focusing on the
institutional market in Northern California, Washington and Oregon. She
partners with Gavin England, Brent Chapman, Kevin Hutton and Dave
Eliopulos, and each of their respective local teams. Tookey previously
worked as a MassMutual specialist supporting the not-for-profit market. Prior
to joining MassMutual, she was a sales director for Principal Financial Group,
and has 10 years of experience in the retirement business.
Scott Buffington, vice president of sales for
MassMutual Retirement Services, says the sales team made sales of $9.9 billion
in 2015.
NEXT: ERISApedia adds attorney author for qualified plan info.
Ilene H. Ferenczy will take over writing the Qualified Plan
eSource published on ERISApedia.com.
Ferenczy is
the managing partner of Ferenczy Benefits Law Center LLP, an employee benefits
law firm in Atlanta. The Qualified Plan eSource is a treatise for Employee Retirement Income Security Act (ERISA)
professionals working with defined contribution (DC) plans.
Ferenczy advises
clients on all types of employee benefit plan issues, with a particular focus
on qualified retirement plans, benefits issues in mergers and acquisitions, and
advising third-party administrators of employee benefit programs on technical
and practice issues. Ferenczy is a frequent national presenter and has written
two books, three textbooks, and more than 90 articles on various aspects of
employee benefits. She is a member of ASPPA’s leadership council, a former
co-chair of the organization’s government affairs committee, and the 2007
recipient of ASPPA’s Educator of the Year Award. Ferenczy is also a Fellow in
the American College of Employee Benefits Counsel, the highest honor awarded to
ERISA lawyers.
Timothy McCutcheon, publisher of ERISApedia.com, says Ferenczy’s
unique insight and practical examples will be valuable additions to the
Qualified Plan eSource.
ERISApedia.com
provides retirement plan sponsors, administrators with easy access to compliance
information and important retirement industry materials.
NEXT:
Mercer adds senior pension risk transfer consultant.
Lynn Esenwine will join Mercer as a senior pension risk transfer (PRT) consultant in the
financial strategy group (FSG) in April.
Esenwine will
focus on facilitating large buyout transactions, coordinated with broader risk
management and investment strategies, and on driving Mercer’s continued
innovation and solutions in this space.
As the firm
says it expects substantial growth in this area, Mercer calls Esenwine a key
addition at a pivotal time for the PRT market.
Esenwine has
15 years’ experience in retirement services and has provided strategic
leadership in the PRT market. She joins Mercer from MassMutual, where she was vice
president in pension buyout, leading a cross-functional team focused on the
growth of MassMutual’s market presence. Previously, she was vice president in a
market-facing role serving the institutional PRT space at Prudential Retirement.
Esenwine
will report to Richard McEvoy, head
of the division, who cites Esenwine’s knowledge and transaction experience. “Lynn
has had industry-level impact in helping drive the PRT business forward in
recent years with her focus, energy and creativity,” he says.