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The ROI of Financial Wellness

Improving financial wellness is a matter of behavioral economics, according to Ramsey Solutions' Brian Hamilton and Stonestreet Advisor Group's founder and Principal Barbara Delaney. The two spoke at an April 17 workshop session at the NAPA 401(k) Summit in Nashville.

“We as advisors do have a problem,” said Hamilton, laying out the scope of the challenges impeding retirement saving. Among them, said Hamilton, are that 70% of Americans live paycheck-to-paycheck; two-thirds can’t meet a $1,000 emergency without taking out a loan; and 21% of eligible participants borrow against their 401(k)s.

Employees’ personal financial troubles hurt productivity by up to 20 hours per month, Hamilton posited, asserting, “You have to understand when employees are broke, it affects your plan.” Delaney made a similar suggestion, noting that health and wellness is a major expenditure for an employee, and that pointing out its connection to retirement saving can help their bottom line, while demonstrating its impact on employees is good for the employer's bottom line.

The key to increasing employees’ retirement savings rate is to change behavior, both argue. Hamilton advocates using inspiration and information. “You have to weave these things together” to change behavior, he said.

Both stressed that incentives are helpful in getting workers to participate and change their behavior. But Hamilton argued that simply providing financial incentives ultimately is not the best approach, since taking away such an incentive could stop the behavior it was meant to encourage.

And corporate culture also plays a role in openness to increasing saving, said Delaney, and both argued that plan sponsors play a key role in encouraging better savings rates.


  • Attendees at the session offered some of their own suggestions:

  • Consider time of year when encouraging employees to improve their saving habits.

  • Draw parallels to physical wellness.

  • Obtain the buy-in of the retirement committee.

  • Identify an internal champion — perhaps human resources, but an employee would be even better.


“It’s up to us as an advisor industry to take the lead on this,” said Delaney.

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