PLANADVISER - September/October 2022 - 29

Health, Wealth and Retirement
If health care is the biggest expense in retirement, " Why do
we silo it from retirement planning conversations? " said Brea
Dantin, adviser and chief operating officer of ProCourse Fiduciary
Advisors LLC.
She and two other panelists probed how to incorporate
health-expense planning
into retirement planning and
whether health savings accounts expand business opportunities
for advisers.
" We are already retirement experts-do we need to be
health-care experts, too? " Dantin said. Employees are not
thinking about health care in retirement, but their current
cash-flow needs, she said. So how do advisers turn the
conversation?
According to Kevin Takinen, adviser, 401(k) and financial
well-being, at Sequoia Consulting Group, given employees'
decumulation needs, and that the average retiree's healthcare
costs are projected to exceed $300,000, saving in an HSA
is as important as saving in a defined contribution plan.
Still, Takinen said, advisers need not be health-care
experts. " It's important to cultivate partnerships, " he said.
" Understanding that plan sponsor clients need to balance
their benefits spend, advisers should ask to talk to their
clients' health-care brokers. Advisers should talk to sponsors
about all their benefits offerings. "
Chris Ceder, head of Americas retirement and financial
wellness programs at Goldman Sachs Asset Management,
stressed talking to sponsor clients and their HSA providers
about what the HSA program will offer. " Do you want the
accounts to be only a deductible offset? If so, that might not
give employees the opportunity to save, " he said. " Advisers
can work with clients' benefits brokers on [program] design. "
Partnering with HSA providers and educating plan sponsors
and participants can create relationships that lead to
providing additional services, said Takinen. Advisers have an
opportunity to show employees how to allocate their money.
" For example, save in the DC plan to the match, then put
savings into an HSA, and, if there's anything left, make Roth
retirement plan deferrals, " he said.
Further, HSAs can help sponsors pass DC plan nondiscrimination
testing, Dantin pointed out. Highly compensated
employees can put extra savings into the HSA, and
they are still saving for retirement.
In programs where HSA dollars may be invested, advisers
can explain how that works, Takinen said. " It's an additional
opportunity to educate, partner and help. Start with goodwill-building;
it could lead to a revenue stream. "
Asked how advisers should advise employees who have
no access to an HSA, Ceder said they need to boost their
regular savings.
Think about their savings in buckets, Takinen added:
savings for living expenses, for health care and for nonessentials,
for example.
Dantin noted that efforts are underway to decouple HSAs
from high-deductible health plans, which will make these
vehicles available to many more people. -Rebecca Moore
... employees seeking help
with financial planning has
risen consistently since 2018
and is higher now than ever.
Participant Mindsets and
Communication Strategies
Market volatility, the rising cost of living, plus fears of
having too small a nest egg and diminished Social Security
are among the financial concerns weighing on the minds
of retirement plan participants. Knowing this can help
plan advisers connect with these individuals and provide
valuable insights that could improve their circumstances,
session speakers said.
You may find yourself acting more as a financial psychologist
than a financial adviser, because participants are
anxious about the rising cost of living and market volatility,
said Sean Kelly, vice president and financial adviser at
Heffernan Financial Services.
Panelist Kelley Palmer, senior director of participant
marketing at John Hancock, emphasized that U.S. households
are feeling pinched. Even among those earning over
$250,000, 3% live paycheck to paycheck, and " stresses are
across the board, " she said.
For these reasons, participants are looking for help to
optimize their retirement savings, and advisers can use
that information to increase and improve communications.
She cited data from John Hancock revealing that the share
of employees seeking help with financial planning has risen
consistently since 2018 and is higher now than ever. This year
alone, the share of employees who would like such assistance
rose to 75% from 73%. Nearly 80% of people surveyed between
May and August said they could use help choosing investments,
up from 76% in the first quarter, her data showed.
According to Kelly, when the stock market is volatile,
show participants that the market's best days often follow
its worst-e.g., how it bounced back in late March and April
2020 after its February dive. " Time in the market is better
than timing the market, " he said, adding that it is important
to communicate, " with market timing, you have to be right
twice, " when you sell and when you buy.
Palmer recommended communications that help participants
forecast what their income will look like in retirement.
Other topics good for communications, she said, include
accessing expertise on estate planning; assessing financial
wellness and identifying gaps; opening an emergency savings
account; and understanding educational savings tools.
The panelists also suggested that the topic of investing
in a Roth, or after-tax, retirement account is a good one for
engaging younger participants, because their longer window
until retirement means they could benefit from decades of
tax-free growth on their investments. -Amy Resnick
planadviser.com September-October 2022 | 29
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PLANADVISER - September/October 2022

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