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ADVISORS TAKE STEPS TO MEASURE EMPLOYEE ENGAGEMENT IN FINANCIAL WELLNESS PROGRAMS

Troy L. Redstone AIF®,  CFEI®, CBFA®  - PHD. Retirement Consulting
President of the Retirement Advisor Council

Employee engagement is essential in determining the value of any Financial Wellness program. The purpose of this Research Report is to help retirement plan sponsors design a Financial Wellness Program Management Dashboard based on the practices of leading retirement plan advisors. The report provides a framework for monitoring progress and gives guidance to plan sponsors on the key indicators to monitor.

Depending on how your Financial Wellness program was conceived, employees may be able to access services through any one of several doors (i.e., the initial point of entry).

Employer commitment is a leading indicator of future employee engagement.

  • Selection of metrics to which the program will be monitored short- and long-term

  • Assignment of accountability / responsibility for monitoring implementation

  • Assignment of accountability / responsibility for outcomes

  • Scope of dedicated resources (staff, infrastructure, budget)

  • Scheduling of periodic progress review meetings

  • Program adherence

  • Self-service portal (Web, app, automated phone, automated assistant)

  • Group meeting (education)

  • One-on-one coaching (counseling, planning, or even advice)

Multimodal programs allow employees to select the point of entry that best fits their needs. The selection of metrics to include on the dashboard will vary depending on the points of entry available in the program.

One strategy for the most committed employers to drive engagement in Financial Wellness programs is to implement a rewards or points program that incents employees to use the program. Leading advisors surveyed in this report say that, on average, 19% of their clients with a Financial Wellness program use a rewards or points program to stimulate participant engagement. Programs such as these have been quite successful on the healthcare front, where employees earn points for having regular medical checkups or going to the gym. They make just as much business sense in helping employees achieve and maintain Financial Wellness.

Employee Engagement Metrics Used by Leading Plan Advisors

Leading plan advisors measure employee engagement in a variety of ways. Some rely on feedback and updates from the plan sponsor, perhaps by studying the results of employer surveys. Others monitor participant behavior, tracking participant attendance at meetings and the frequency of inbound calls to gauge the number of participants who take steps to implement a plan with the help of a Financial Wellness counselor. Some rely on hard plan metrics when assessing the efficacy, or even ROI, of the Financial Wellness program, looking to engagement metrics or outcome metrics as indicators of program success. These metrics typically include changes in participation and deferral rates to loan payoffs, emergency savings increases, and the increased use of managed accounts or changes in asset allocation. The Consumer Financial Protection Bureau, a federal watchdog agency, estimates that employers typically see an ROI of $3 for every $1 invested in a financial well-being program.


One of the most relied-upon employee engagement metrics is the percentage of employees that access a Financial Wellness portal. Among those who access the portal, what percent enter any data? How many utilize any of the available products or services, or attend a group education session? What percent obtain a personalized assessment of their own Financial Wellness? How do they rate their satisfaction with the program? How many seek a meeting with a Financial Wellness Advisor?


Service models vary greatly among leading plan advisors as they design a model best suited to the unique needs of their clients. Some advisors who work with employers well-staffed to administer a Financial Wellness program internally or through their retirement plan service provider do not pro-actively contact employees. Others assessing usage rely on discussions with the plan sponsor or actively monitor participant behaviors.

“WE OFFER ONE-ON-ONE INDIVIDUAL CONSULTATIONS. WE USE THE LEVEL OF ENGAGEMENT AND ACTIONS TAKEN FROM THESE MEETINGS TO MEASURE FINANCIAL WELLNESS.”

“WE TRACK USAGE IN THE PROGRAM OVERALL AND HOW MANY EMPLOYEES ELECT TO IMPLEMENT A PLAN WITH OUR FINANCIAL WELLNESS ADVISORS.”

“OUR TEAM TRACKS ATTENDANCE AT MEETINGS AND LOOKS AT THE OTHER METRICS OF THE PLAN, LOANS, INCREASED CONTRIBUTION, ALL THE POSITIVE METRICS.”

Most Commonly Used Employee Engagement Metrics

...accessing a Financial Wellness portal80%
...entering any data in a Financial Wellness portal75%
...using any data in a Financial Wellness service or product70%
...attending a Financial Wellness education session70%
...obtaining a personalized assessment of their own Financial Wellness70%
Employee Satisfaction with the program (or Net Promoter Score)70%
research-blue-stripe-icon.jpg

Percent of Advisors relying on the metric

Proposed Model Financial Wellness Program Engagement Metrics

 

Number or Percent of Employees Who...

Timing of measurement

research level 1
  • Access a portal

  • Attend a session

  • Meet with a coach for the first time

  • Use any Financial Wellness service 

Immediately at implementation

research level 2
  • Enter data in the portal

  • Provide initial data to a coach

  • Submit a completed questionnaire at a group meeting 

Start in the first month of implementation. Monitor weekly for the first six months.

research level 3
  • Obtain initial assessment

  • Obtain detailed assessment

  • Have formulated a step-by-step plan of action 

Start in the first quarter of implementation. Monitor monthly for the first year.

research level 4
  • Access the portal after the initial access

  • Receive points or credits for accessing educational content

  • Have updated their plan of action to reflect progress made and steps completed

  • Had a follow-up visit with a Financial Wellness coach 

Monitor quarterly – ongoing 

research level 5
  • Retirement Readiness score

  • Components of the readiness score, such as

    • balance

    • participation rate

    • average deferral rate

    • loan utilization 

  • Emergency savings

  • HSA balance

  • Student debt

  • Credit card debt

  • Net worth

  • Credit Score 

Monitor quarterly – ongoing

research level 6
  • Employee satisfaction

  • Employee retention

  • Suggestion box

  • Employee happiness

  • Employee financial stress 

Monitor quarterly – ongoing

     

Level 2 metrics entered at the portal can be tiered by type of information – information collected incrementally so a complete picture of the employee’s level of engagement can be drawn progressively.

Percent of employees who provided:

  • Contact information

  • Demographic information

  • Home value / cost of housing

  • Retirement plan information

  • Beneficiary designation

  • Banking information (assets)

  • Banking information (debt – mortgage, credit card, student)

  • Securities held (taxable and non-taxable accounts)

  • Other assets

  • Insurance information

The Necessity to Monitor Engagement by Segment

Percent of Plan Sponsors Tracking Engagement by...

Age59%
Gender40%
Plant/Location39%
Position26%
Race*6%
research-blue-stripe-icon.jpg

Average percent of plan sponsors

*Data not always available in HRIS system

Enhancing the Financial Wellness of employees over time requires some analysis to identify segments of the population who are perhaps left behind or disengaged so action can be taken. Overall measurement alone does not foster progress. Employers who look deeper into employee engagement metrics by tracking employees by age, gender, employment location, and role or position can pinpoint segments of the population who are at greater risk of delayed retirement.

A majority (59%) of employers track employee engagement by age, which is understandable as employers will want to get younger employees on a path to saving while keeping a close eye on employees nearing retirement age. Somewhat fewer track by gender or job location (40% and 39%, respectively). A small number of employers (only 6%) track employee engagement by race. Not all employers track employees’ race in HRIS systems. The large number of employers who are not subject to affirmative action are not required to do so.

About the Survey

This report was commissioned by the Financial Literacy and Financial Wellness Promotion Committee. Chair: Wendy Daniels - Transamerica | Vice-Chair: Mark T. Ratay, CIMA®, PRP® – Morgan Stanley. The survey was conducted July 14-31, 2020. Seventy Council member advisors responded representing 8,209 plans and 4,052,300 participants.

Sincere Thanks to Contributors

401k Advisors Chicago
Stace Hilbrant AIF®, PRP®, CFS

401k Plan Professionals
Jessica Renee Ballin AIF®, C(k)P®

AFS 401(k) Retirement Services, LLC
Alexander G. Assaley, III AIF®

AID Wealth Solutions Group - James M. Aid

Alliant Retirement Consulting - Sarah Keibler

Asset Strategy Advisors
Kent A. Fitzpatrick AIFA, ARPC, GFS®

Avenue Advisory Group
Martha Spano AIF®, CRPS®, EFC, CPFA

Black Diamond Advisory Services - Timothy Black Brad Grist

Buckman & Corning Financial Strategies Group Nicole Corning AIF®, CFP®, CRPC®

Cafaro Greenleaf Advisors - Jamie Greenleaf

Cafaro Greenleaf Advisors - Jared J. Manville AIF®

CAPTRUST Financial Advisors
Jeb Graham CPFA, CIMA, CEBS

Chepenik Financial, A One Digital Company

Compass Financial Partners
Kathleen Kelly CRPS, AIFA

D’Aiutolo, Malcolm & Associates Investment Consulting Group
Alicia Malcolm and Paul D’Aiutolo AIF®, PRP®

DiMeo Schneider & Associates, L.L.C.
Jim Modelski
Erik K. Tappin CRPS®

Fiduciary Plan Advisors - Jania Stout AIF®

Gaertner Investment Consulting UBS
Daniel Gaertner CRPS

Gouldin & McCarthy, LLC
Michael H. Gouldin CRPC®, AIF®

Graystone Consulting Boston-North Shore
Al Hammond

Guidance Point Retirement Services, LLC
A.J. Walker AIF®

Hammond, Martin & Associates
Kimberly L. Hammond CFP®, CIMA®, CPFA, C(k)P®

HUB International
Colin M. Clark MBA, AIF®, C(k)P®, CBFA™, CPFA

KAF Financial Advisors, LLC
Thomas E. Hoffman AIF®, CFS®

Kidder Advisers, Inc.
Keith J. Gredys JD, CTFA, AIF®

Kraematon Group/ Axial Benefits - Richard Sotell

Legacy 401k Partners, LLC - Patrick Stuhr AIF®

LHD Retirement
John Ludwig ChFC, AIF®, CRPS®
Luke J. Novak
Marc Zimmerman AIF®, C(k)P®

Marsh & McLennan Agency - Robert Clark AIF®

Marsh & McLennan Agency - New England Nathan Rasmussen AIF®

Marshall-Amato-Buxton Group at Baird
David Marshall QPFC, CRPS®

Moneta
Sean M. Duggan CPC, AIFA, AIF, QPA, QKA, CPFA, TGPC, CBC

NFP Advisors
Paula A. Hendrickson CFP, C(k)P®, CBFA™
Paris International - Michael R. Paris  PHD. Retirement Consulting
Troy L. Redstone AIF®, CFEI®, CBFA, CPFA®

Plan Sponsor Consultants
Michael M. Kane AIFA®, ChFC®, CLU®, CBFA™

PlanPILOT - Nate Cassel

Praxis Consulting
Mark D. Ray AIF®, PRP®, CBC, RF™, GFS™, CRPS®, C(k)P®

Qualified Plan Advisors, Houston
Robert A Massa ChFC®, CEBS®, AIF®, CBC®

RBC Plan Resource Group
Patrick McKiernan C(k)P®

Retirement Advisors
Michael C. Perry CPC, AIF®, CPFA

Retirement Plan Advisors, RBC Wealth Management Jerry Bosch

Shepherd Financial - Steve Wylam CFP, AIF®, CPFA

Sheridan Road Financial a division of HUB International Retirement and Private Wealth
Jim O’Shaughnessy AIF®, PRP®

Sikich Retirement Plan Services
Joe Connell AIFA®, QPFC, CRPS®, RF™

Spectrum Investment Advisors
Matthew P. Demet CEBS, CRC, AIF®

SS/RBA - Barbara J. Delaney AIF®, PRP®
Steven R. Puckett AIF®, CRPS®, CPFA

Stonebridge Financial Group
Brad Pinter CRPS®, AIF®, ChFC®

Strategic Retirement Partners
James D. Robison AIF®

Strategic Retirement Partners
Craig C. Dewey AIF®, ARPC, CPFA

Strategic Retirement Partners - Los Angeles
Erin Hall AIF®, C(k)P®, CPFA

Strategic Retirement Partners - Nashville
Jeanne J. Fisher CFR®, CPFA

Summit Financial Group, Inc - Kaci Skidgel

Summit Group Retirement Planners, Inc.
Derek C. Fiorenza C(k)P®, CPFA, AIF®, PPC™

The Dubie Group at Morgan Stanley
Christopher Dubie AIF®, CRPS®

The Kikawa Group - Karen Yasukawa CIMA®, AIF®

The Ratay Group at Morgan Stanley - Mark Ratay

TriBridge Partners - Chris Schneider

UBS Retirement Plan Consulting Milwaukee

WealthPlan Advisors

Westminster Consulting - Sean Patton

Wintrust Retirement Benefits Advisors
Daniel J. Peluse AIF®, C(k)P®, CBFA, CRPS®

Financial Wellness Program of the Council

The Retirement Advisor Council accomplished a great deal to promote the Financial Wellness of U.S. workers in 2020/2021:

  • Prestigious Financial Wellness Awards to deserving plan sponsors delivered at the January and August meetings

  • Seven VIEWPOINT papers published on Financial Wellness, including one designed to guide the reader through the evaluation of solutions available to build the right program for their situation

  • Advisor research on drivers of participant engagement

  • Guide to Financial Wellness – A series of interactive video conference meetings to highlight the best Financial Wellness programs

About The Council

The Council advocates for successful qualified plan and participant retirement outcomes through the collaborative efforts of experienced, qualified retirement plan advisors, investment firms and asset managers, and defined contribution plan service providers.
Retirement Advisor Council is a brand of EACH Enterprise, LLC

 

Eric Henon, Executive Director
Retirement Advisor Council
(860) 653-1701
ehenon@retirementadvisor.us

Retirement Advisor Council | 61 Rainbow Road | East Granby CT 06026
www.retirementadvisor.us

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