FA-IQ reached out to advisors ranked on the Financial Times FT 401 list of top retirement savings advisors to ask:
What is the biggest concern about financial wellness, besides retirement, you hear plan sponsors ask about?
Doug O’Rear of OnTrack 401(k) in Frederick, Md., has been in business 13 years and manages $225 million:
The majority of our clients utilize proactive plan design with auto enroll, auto escalation, and QDIAs. As a result, employees in our plans are doing a great job of getting started, saving enough, and investing appropriately.
Questions relative to financial wellness we get from plan sponsors are typically reflective of questions they are getting from their employees. If employees are starting early, saving enough, and investing appropriately, what’s left? The answer: life events.
The questions we get are typically related to a life event, such as paying off student loans, purchasing a first home, paying off debt, nearing retirement, etc.
From our perspective, the most successful financial wellness programs are a combination of great technology and a human factor.
It’s the combination of the two that help employees have a clear understanding of what they have, necessary steps, and accountability.
Daniel Peluse of Wintrust Wealth in Chicago has been in the business 17 years and manages $1.85 billion:
The biggest concerns other than retirement for our clients have been to assist participants with budgeting and debt management along with emergency savings strategies. One of the common issues we see for participants with budgeting and debt management is simply establishing an initial budget. We help by introducing them to easy-to-use tools and educating them about priorities, such as paying off high interest debt.
Additionally, general financial literacy remains a concern with topics ranging from insurance to mortgages. It’s easy to forget that many of the insurance and mortgage terms we use in financial planning every day aren’t as well understood by plan participants. It’s up to us to help them understand. We work with employers to help them educate their staff, especially around important issues like understanding how to find the best fit insurance products and mortgage for each individual’s situation and goals.