“Is a financial wellness program similar to our employee wellness program, but for retirement?”
Michael A. Webb, vice president, Cammack Retirement Group, answers:
This is an excellent, and timely, question, as you would be hard-pressed to open a retirement plan-related publication of late without encountering the term “financial wellness.”
Similar to the concept of a wellness program for one’s physical health, financial wellness is a program designed to improve an individual’s financial health so that one is able to accomplish one’s financial goals, such as saving amounts sufficient for retirement. All too often, the relatively low voluntary participation and savings rates encountered in retirement plans are not due to the fact that participants are unwilling to save, but the result of an inability to set aside income due to financial barriers such as credit card or other debts.
A financial wellness program attempts to address such issues so participants can improve their financial positions. The concept is relatively new, and plan sponsor adoption is not high, but is growing. In addition, some plan sponsors have incorporated financial wellness in their overall structure of employee benefits working to make certain that employees are making desirable choices with respect to their health as well as their finances.
NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.