Data and Research April 26, 2017

Employee Financial Wellness Key to Company Success

A survey of financial executives finds that most highly value the financial stability of their workforce as a critical component to a successful HR management strategy.
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Most financial executives believe that employee benefits packages focusing on financial wellness are key drivers of success for their companies, according to a recent survey by CFO research and Prudential.

The study found that more than half of executives or 82% believe their company will benefit from having a financially secure workforce. Only 5% said they don’t believe so, and 13% said they were not sure. Most executives view financial wellness as a key component of corporate performance, as well as an effective human resource-management strategy.

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“It is encouraging to see that employers are seeing the value in helping employees focus on financial wellness,” says Jim Gemus, senior vice president, distribution and product management, Prudential Group Insurance. “In particular, employers seem ready to look at ways to not only measure the financial wellness of their employees, but also to benchmark it against other companies in their industry. This survey demonstrates that the vast majority of employers recognize that improving the financial wellness of their workforce yields significant benefits for their companies and employees alike.”

More than six in ten respondents (63%) say that employee satisfaction with benefits is important for their company’s success, and 65% believe that employee benefits are critical to attracting and retaining employees. Even if the deductibility of employer-sponsored benefits were to be removed, several respondents (29%) said their companies would either continue to offer the same package with the same subsidies or increase employee compensation to counterbalance reduced corporate subsidies (28%).

Most (78%) also said that employers should assist employees in achieving financial wellness during their working years. Only 8% disagreed and 14% were not sure. Even more (84%) say that it is important to ensure that their companies’ employees are educated on key tenets of financial wellness.

Finance executives consider higher employee satisfaction (59%) and increased retention (53%) as the most important benefits coming out of a focus on financial wellness.

Seventy-percent agree that it is important for their companies to measure employees’ financial wellness. About the same number (71%) agree that benchmarking their employees’ financial wellness versus other companies is an added source of value.

These findings are from the sixth annual survey of the benefits landscape conducted by CFO Research and Prudential. This year’s results are based on survey of responses of 180 finance executives, most of whom (78%) work at large U.S. companies with more than $1 billion in annual revenues.

More information on the survey can be found at Prudential.com.

Compliance April 26, 2017

DOL Asks to Initiate Surveys About Retirement Strategies

The agency says gaining additional insight into Americans’ decisionmaking processes and experiences will “provide policymakers and the research community with valuable information that can be used to guide future policy and research.”
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The Department of Labor (DOL) has submitted for review by the Office of Management and Budget an information collection request titled, “On the Road to Retirement Surveys.”

Public comments on the request are invited, DOL notes, and the underlying initiative will be piloted by the Employee Benefit Security Administration (EBSA).

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As the DOL explains, “the EBSA seeks to undertake a long-term research study that will track U.S. households over several years in order to collect data and answer important research questions on how retirement planning strategies and decisions evolve over time.”

The collection “will gather data about how people make planning and financial decisions before and during retirement, especially with regard to the information that they receive and how they respond to it.”

DOL and EBSA say the data collection effort is “designed to overcome the limitations seen in existing data collection activities.” Further, gaining additional insight into Americans’ decisionmaking processes and experiences will “provide policymakers and the research community with valuable information that can be used to guide future policy and research.”

The information collection request at hand seeks approval for “pre-test surveys, a screening survey, an initial participant survey, an advice interaction survey, and an annual participant survey.” Household reports on behavior and outcomes will be combined with survey responses on planning methods, strategies and financial information received to perform a cross-sectional analysis, conditional on other respondent attributes.

“The EBSA intends to use data drawn from multiple waves of various surveys to analyze how behavior evolves over time,” DOL adds, noting that the Employee Retirement Income Security Act Section 513(a) authorizes the information collection. 

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