The results of a multi-year study focusing on 2,458 employees who regularly engaged with their employer’s financial wellness program in the five years between 2013 and 2018 found that the employees improved in all areas of financial planning—with the greatest level of improvement in retirement preparedness. Another study suggests that financial illiteracy impedes retirement plan participants’ ability to determine how to invest their savings. But, plan sponsors haven’t needed such studies to realize that participants need more education than just about the retirement plan. Enjoy this edition of PLANSPONSOR Weekend which focuses on participant education and financial wellness.
Researchers argue that financial illiteracy impedes plan participants’ ability to determine how to invest their savings, and propose mandated employer-provided financial education to address limited employee financial literacy.
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If legislation passes to allow for open multiple employer plans (MEPs) for plan sponsors without a common nexus, experts believe they will offer benefits to plan sponsors, but there would be some considerations to explore before joining one.