Financial Wellness Offerings a Value-Added Service for DC Plan Clients

Nearly three-quarters (73%) of advisers report that they specifically offer financial wellness support to defined contribution (DC) plan clients, according to LIMRA Secure Retirement Institute (LIMRA SRI).

 

“Financial wellness programs offer the adviser an opportunity to use creative ways to provide value-added services and programs to their plan sponsor clients,” LIMRA SRI says.

 

The study finds almost all DC advisers who provide financial wellness services offer retirement savings services and investing support (96% and 95%, respectively). Other financial wellness offerings include:

• Rainy day/emergency funds (71%),
• Budgeting and managing spending (66%),
• College savings (66%),
• Short-term saving to support planned expenses (59%), and
• Managing debt including college loans and credit cards (58%).

 

LIMRA SRI says while most advisers support financial wellness services, managing debt is one of the least likely features to be included in the wellness programs, but as previous LIMRA SRI research has found, it has one of the strongest ties to one’s retirement savings. Adding this benefit to advisers’ offerings will increase their competitiveness as well as the effectiveness of clients’ DC plans.

 

The study finds advisers who include wellness offerings are also more likely to include other key participant services such as advice to plan participants, retirement income advice, advice to departing participants and custom allocation models.

 

The research shows most adviser groups are not inclined to increase the services they offer, and 15% of those who don’t currently offer financial wellness said they plan to do so in the next two years. In general, for those groups not looking to increase the number of services they offer, the best way to add value to their current offerings would be to enhance the services they already offer in their portfolio, LIMRA SRI says.