To better support advisors and plan sponsors in helping participants achieve financial security, the Capital Group and Financial Finesse announced that they are expanding a financial wellness benefits program to a broader segment of clients at no additional cost.
The initial program brought Financial Finesse financial coaching to select Capital Group DCIO clients in the mid-sized plan sponsor market and to PlanPremier full-service recordkeeping clients in the large plan sponsor market.
Following the success of that initial program, the firms announced that they are expanding the program to prospective Capital Group clients in the large plan sponsor market—with no additional cost for plan sponsors or their participants.
According to the announcement, plan participants will receive unlimited access to Financial Finesse’s digital financial wellness hub, virtual financial coach and interactive guide AimeeTM, live webcasts, and a team of CFP professional financial coaches available via phone and live chat.
“We are thrilled with the results of the initial program and the plans to expand it,” said Liz Davidson, founder and CEO of Financial Finesse. “Within 15 months of the initial program’s launch, plan sponsors saw participant engagement of over 38%—well above industry benchmarks. The program also proved that integrating financial coaching can drive a significant increase in assets under management for retirement plan advisors.”
For Brendan Mahoney, head of Institutional Retirement Strategic Growth at Capital Group, integrating financial wellness into the firm’s offering has been a “critical component of improving participant outcomes” as the firm continues to expand access to savings through employer-sponsored retirement plans. “Our partnership with Financial Finesse is also an important part of helping advisors scale their business by giving them the ability to bring an in-demand benefit to the plan sponsors they serve,” he further notes.
“Access to Financial Finesse’s industry-leading financial coaching has been an absolute game-changer, answering a pressing need for our plan sponsor clients and their employees,” adds Sean Bjork, President of Bjork Asset Management, Inc., who works with several plan sponsors who participated in the initial program.
5 Key Focus Areas
The expanded financial wellness initiative comes as the Capital Group’s institutional retirement business pursues strategic growth opportunities to capitalize on the changing dynamics of the U.S. retirement landscape.
To that end, the firm in an earlier announcement noted that it is forming partnerships to enhance existing client relationships and test new solutions for participants through a series of pilot programs, with the financial wellness initiative the Capital Group is running with Financial Finesse being the first.
In addition to financial wellness and engagement, the initiatives will focus on four additional key areas:
- Collective investment trust (CIT) expansion: To address the growth of CITs, Capital Group is working with a range of recordkeepers and investment consultants to deploy the firm’s strategies in intermediated structures, adding new recordkeeper and aggregator advisory firm CIT arrangements.
- Qualified default investment alternative (QDIA) evolution: In addition to offering co-branded and co-manufactured target date solutions that leverage the American Funds glidepath and their underlying funds, the Capital Group in 2022 launched Target Date Plus, in partnership with Morningstar Investment Management. The service, which enables personalized allocation advice, will be made available this year on various recordkeeping platforms.
- Retirement income: Helping plan participants create a “retirement paycheck” will require an array of retirement income solutions. As such, Capital Group says that it is working in conjunction with several service providers, with each playing a role along the spectrum of in-plan, out-of-plan and hybrid scenarios.
- Bridging the retirement-plan-to-wealth gap: With recordkeepers, advisors and consultants looking for services and support to help bridge the gap between their retirement plan and wealth management business, the firm notes that it is fostering a “seamless and multifaceted” approach for helping advisors bridge this gap through wealth solutions, including model portfolios, 529 offerings, high-net-worth capabilities, and the latest insights on practice management.
“By listening to and learning from the advisors, consultants, and other distribution partners with whom we work, Capital Group’s institutional retirement business is addressing the changing dynamics of the U.S. retirement and asset management landscape head-on,” Mahoney further remarked. “Advisors are working tirelessly to help their clients save for retirement and it is our mission to give them the tools and resources to see that objective through.”
