Plan Progress: Building an Effective Financial Wellness Program

The best programs include financial coaching, including one-on-one sessions, and are appealing to employees, experts say.

More plan sponsors have been implementing financial wellness programs to make sure their employees are financially, as well as physically and emotionally, healthy. These programs take a participant’s full financial picture into consideration—not just their retirement savings—which means plan sponsors looking to build such a strategy need to consider several elements.

During PLANSPONSOR’s latest Plan Progress webinar, “Building an Effective Financial Wellness Program,” Kelli Send, senior vice president of Francis Investment Counsel, said a program should include more than just budgeting, education and action items.

“To really drive change, you need to provide a coaching atmosphere,” Send said, noting that she attained a master’s in adult education and has studied how adults learn, but has yet to find a group workshop that fully incorporates a coaching atmosphere and that drives a lot of change.

Sponsors need to realize that financial wellness programs should help their workers first figure out their financial priorities, Send said. “Even for young Millennials, money is personal,” she said.

Sponsors can solve for this gaping need in financial wellness programs by giving their workers the opportunity to have a “person-to-person relationship with a money coach,” Send said.

Francis Investment Counsel, for instance, has a staff of five financial planners that meet participants at their offices or workplaces to help guide them through the steps, Send said.

“The human touch is important,” she said. “The second piece of that is the human is going to need to be trusted.”

Sponsors need to ensure that the financial wellness provider or coach doesn’t try to sell participants products on the side, Send said. They also should try to include incentives and gamification—the application of game-playing elements such as scoring—in their programs, such as by give participants points to keep their momentum going, she said.

Bettencourt recalled how, 25 years ago, the convergence of health and wellness was starting to happen. She said she thinks that despite years of discussion, the needle hasn’t moved much on that. “It still feels like it is in its infancy,” she said.

Getting Workers’ Buy-In

Companies can raise awareness of their financial wellness programs by putting up posters, holding classes and hosting health fairs on financial wellness, said April Bettencourt, global employee benefits manager at VSP Global. “That is where VSP started,” she said, calling this “level one.”

“Level two” is hosting lifestyle events with gamification elements.

“Level three” is “building a culture around wellness,” Bettencourt said. This can be done by setting up a toll-free phone number employees can call for advice, scheduling classes on financial wellness, gamifying the whole program and then “building it into the culture,” Bettencourt said.

If this sounds overwhelming, it doesn’t have to be; there is no need for a company to start at level three or to fast-track any of this, Bettencourt said. But, “you want to start somewhere, which is better than nowhere,” she added.

When Francis Investment Counsel starts a financial wellness program for a client, it brings in financial coaches and offers one-on-ones with them to a company’s workforce, during company time and at no charge to the employee, Send said. “No matter their age, employees respond really well to one-on-ones,” she said.

How to Evaluate Providers

In terms of how to select a financial wellness provider, Bettencourt said companies should first determine if they have the talent and the resources on staff to build it themselves. But some firms may need to partner with another organization to build a program that fits their needs.

If a company decides to hire a financial wellness provider, or asks its retirement plan adviser or consultant to offer the program, it should consider the knowledge and credentials of the company, Bettencourt said, and plan sponsors should make sure their provider understands the company. She said, for example that “VSP is a HUD [U.S. Department of Housing and Urban Development] agency, and you have to be a HUD agency to provide some of the things we do.”

Financial wellness programs, in many instances, need to be provided in Spanish and consider workers who aren’t native English speakers, she continued. Even the marketing materials need to be in Spanish and simple English for a more successful rollout, Bettencourt said.

“All of those are considerations,” she said. “Building that internally is a big hill to climb.”

To overcome this, VSP partners with its vendors to keep its financial wellness program running and up-to-date, she said. “What I look for from vendors, is what can they bring to [help] my employees and whether or not they can offer one-on-ones,” she said.

Companies might be surprised to learn that they can also partner with local banks, even big banks, at the corporate level, she said.

Send said this is a good route for smaller companies to consider. “If you have zero budget [for a financial wellness program], use those local resources,” Send said. “At least you are starting,” even if it is just a class on budgeting.

Small employers with limited funds should aim to show to their workers that they are committed to the financial wellness program, she added. “That is a soft cost, but that is a cost.”