In Practice June 13, 2007

Participants Want Financial Planning Services within DC Plans

More than three-quarters (85%) of participants in 401(k) and other defined contribution plans say they would use general retirement planning services if available.
Reported by
However, 59% of participants do not have such planning services available to them, according to a new Spectrem Perspective report titled “Financial Planning at the Workplace.” In all financial planning categories tracked, the majority of plan participants without access expressed an interest in using these services, Spectrem said.
Of those participants without access to financial planning through their retirement plans, 81% indicated they would be interested in investment planning/review if offered and 57% said they would use education funding advisory services, a press release about the report stated.
“There’s a clear disconnect between retirement plan participants’ interest in financial planning services and the benefits their employers are providing. The vast majority of those without access to these services – nearly 60% of all participants – are interested in them. Indeed, many are even willing to pay for workplace-based advice. For plan sponsors, this translates into a great opportunity to offer a new and highly desired benefit to employees, and one that complements retirement plans already in place,” said Catherine S. McBreen, Managing Director of Spectrem Group, in the release.
The report is based on a telephone survey of 399 participants in defined contribution plans (401(k), 403(b), 457 and TSP plans) completed in early 2007.
Those interested in purchasing “Financial Planning at the Workplace” should contact Spectrem Group at 641 W. Lake Street, Suite 402, Chicago, IL 60661 or (312) 382-8284.

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