PLANADVISER - July/August 2022 - 19

to take a step back and figure out how to get them to a spot
where they do have a dollar to spare. "
After that, Keenehan says, the advice is typically to
start by building an emergency savings account, funding an
HSA-if the employee has access to one-enough to cover
a health insurance deductible, and contributing enough to
the person's DC plan to get the company match.
Many participants want this type of professional advice
when it comes to distributing their savings to meet their
goals. More than six in 10 told Charles Schwab last year that
they believed their financial situation warranted advice, up
from just half in 2020.
Discuss Benefits Relevant to Plan Demographics
Keenehan says, besides working with participants to make
the most of their benefits, he consults with the sponsor to
make sure its benefits are tailored to the participants' needs.
" Each year we pull a lot of data from the recordkeeper,
looking at where participants are in terms of contribution
rates and which plan features they're utilizing, " says Katherine
Golladay,
investment adviser at OneDigital in Baltimore.
" Then we talk to the plan sponsor about what it's been
hearing and if there is a need it's been ask[ed] about. "
This year, for example, many sponsors and participants
have been asking for more content and programming about
how to approach student loan repayment, as the COVID19-related
loan payment suspension is set to end on August
31, Golladay says.
The portion of employers offering student loan repayment
assistance doubled to 8% in 2020, the most recent
year for which data is available from the Society for Human
Resource Management.
Dimensional Fund Advisors takes a similar approach,
helping plan sponsors create customized benefits packages
based on their employee demographics, says Tim Kohn,
head of the firm's retirement distribution group in Austin,
Texas. He says his firm broadly thinks about financial benefits
as falling into five buckets: retirement, student loans,
emergency savings, health savings accounts and financial
wellness. But while there are rules of thumb that participants
can keep in mind, the decision of which bucket to put
their savings into remains complicated.
" We as an industry are racing to get this right, because
participants deserve advice and guidance for their unique
situation, " he says. " But there's no silver bullet on what that
looks like in the benefits space today. "
Consider Incentives to Help Participants Allocate Savings
Once the adviser has determined which benefits make sense
for a client's population, he can work with the sponsor to
think about how to incentivize employees to allocate their
dollars in a specific way, Majors says. For example, offering
a match in an HSA, or an initial deposit in an emergency
savings account, might inspire participants to start using
those accounts or divert their savings from other areas.
In addition to helping plan sponsors think through how
such moves might nudge participants in a certain direction,
plan advisers can also help sponsors understand the
costs of such programs and determine how they will pay
for them.
" If they're adding a match, where is it going to come
from? " Majors says. " Is that going to inflate their employee
costs? Or are they going to reduce their DC match? Or offer
a total savings match for the employee, allocated between
multiple accounts? "
Knock Down the Silos
There is an opportunity for advisers to add value to their
services to sponsors by helping them deliver their benefits in
a more cohesive way, making it easier for participants to visually
and mentally connect all of their benefits, Majors says.
" When you have multiple websites and logins and solutions
that are siloed, it doesn't work well for participants, "
Kohn says. " Advisers can harmonize those benefit silos and
help plan sponsors get everything-DB [defined benefit],
DC, emergency savings, FSAs [flexible spending accounts],
HSAs-all on one page. "
Some plans go a step further, allowing plan participants
to also bring in data or connect to non-plan assets, such as
personal brokerage accounts or assets that belong to their
spouse. Advisers who can gather more financial information
from participants can give better advice, Keenehan says.
" That's why it's so critical to have a secure, online platform
for that data, " he says. " It's extremely important to
know everything that's out there-emergency savings, credit
card, student loan debt; all of that stuff is critical to being
able to provide fiduciary advice that's in their best interest. "
Kohn says many sponsors are also requesting that advisers
come back to their workplace, after remaining away during
the COVID-19 years, to meet with employees individually and
in groups to explain their benefits and provide advice.
Besides financial advice and guidance via managed
accounts, many employers are also offering financial
coaching benefits to help employees meet specific goals
and be more strategic about how to allocate their savings
dollars, says Katie Hockenmaier, U.S. defined benefit research
director at Mercer in San Francisco.
Encourage Management to Remind Employees of Benefits
Regardless of which financial wellness benefits an employer
offers, a key to increasing engagement and uptake is buy-in
and communication about those benefits from senior leadership,
Keenehan says.
That is an area where many plan sponsors have room
for improvement: Just over half of employers communicate
the value of benefits programs to their employees twice a
year or less, according to a Bank of America report.
" The best financial wellness programs have true champions
within the organization and top-down support from the
CEO and the entire C-suite, " Keenehan says. " They should be
actively participating in the financial wellness benefits and
encouraging employees to do the same. " -Beth Braverman
planadviser.com July-August 2022 | 19
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