Dive Brief:
- While wellness gets most of the headlines, employers continue to worry about employee financial health too. Many, in fact, say they are going to take action in one critical financial area - helping employees retire in a timely manner, according to a new survey.
- The Willis Towers Watson research, the Retirement Plan Governance Survey, found an increasing number of employers who plan to shift resources toward benefit adequacy and retirement readiness during the next two years.
- Nearly four in 10 (39%) of the more than 300 U.S. employers that offer a defined benefit and defined contribution (DC) plan view their employees’ retirement readiness as a current risk. Even more — 44% — view it as a risk two years from now.
Dive Insight:
David Speier, a senior retirement consultant at Willis Towers Watson, says it's not a surprise that employee retirement benefit adequacy and the financial fitness keep weighing on employers' minds - especially those who only offer a DC plan (401k etc.), which is most these days.
A worker's inability for a timely retirement was identified as the top risk for nearly six in 10 of these plan sponsors. The ongoing shift to DC plans is now prompting employers to prioritize resources that promote retirement readiness.
While DC plan sponsors pay the most attention to monitoring investment fees (74%) and investment manager performance (61%), benefit adequacy and monitoring participant behavior will be receiving increased scrutiny in the next couple of years - going from 18% now to 38% by then.
When it comes to retirement readiness, employees across the demographic spectrum need help, something that's been proven time and time again after a slew of studies.