An increasing number of American companies are broadening the types of financial and retirement planning tools and resources they provide to workers.
An Aon Hewitt survey shows 93% of employers intend to focus on the financial well-being of their employees in a way that extends beyond retirement. Nearly half (46%) are very likely, and another 47% are somewhat likely to add new plan features, mobile apps or online tools to assist individuals with understanding financial concepts and financial planning.
Read: A new approach to financial literacy
Additionally, more employers are offering tools and resources to help boost retirement savings:
- 69% currently offer online investment guidance, up from 56% in 2014, and 18% of the remaining employers are very likely to add this feature in 2015;
- 53% offer phone access to financial advisors in 2015, up from 35% in 2014;
- 49% offer third-party investment advice, up slightly from 44% in 2014; and
- 47% offer managed accounts, up eight percentage points from 2014.
“Depending on the individual needs of their employee populations, companies are offering features like basic budgeting help, while others are providing assistance on how to save for life events like a home purchase or college,” says Rob Austin, director of retirement research at Aon Hewitt.
Employers are also taking advantage of the size and purchasing power of their DC plans to reduce costs and improve returns for employees.
Read: Engaging employees in financial literacy pays off
Thirty-four percent of employers recently made changes to their fund lineups to reduce plan costs, compared with 27% in 2014.
Of those employers that have not yet made this change, 34% are very likely to do so before the end of 2015. Additionally, the percentage of employers that have recently moved from mutual funds to institutional funds or separately managed accounts has almost doubled, from 16% a year ago to 30% today.
“Employers understand that small plan fees can add up and ultimately make a big impact on workers’ retirement savings,” adds Austin. “To help workers maximize their retirement dollars, employers are scrutinizing each fund in the plan to determine if the associated fees are reasonable.”
Also read: