4 Keys to Implementing a Financial Wellness Strategy That Works

Financial wellness tends to mean different things to different people. To plan advisor Jania Stout, financial wellness is a holistic approach to helping participants with financial literacy and providing clear steps to help them have a plan to achieve their goals.

“This starts with the basics of having a budget and understanding how to manage and eliminate debt — student loans, car loans, credit cards and other debt,” Stout explains in her most recent column for NAPA Net the Magazine. “It continues with basic financial planning topics like wills and different types of insurance — and, of course, education focused on the retirement program, savings rates and asset allocation. Then Social Security and Medicare round it all out.”

Once you have found a client that is interested in implementing a financial wellness strategy, Stout offers four tips that can help increase the likelihood of better engagement and outcomes.

Tip #1: Retirement Plan Subcommittee

Implementing a financial wellness strategy that works takes commitment, focus and time, Stout notes, and nothing is worse than burdening the retirement plan committee with a discussion about financial wellness when there may be committee members who don’t have the desire (or the time) to be spending hours designing it.

“So typically we create a subcommittee of the retirement plan committee to focus on financial wellness,” she says. In addition, it’s important to make sure that prospective members of this financial wellness subcommittee understand what the expectations for the group will be before they join, she recommends.

Tip #2: Define Financial Wellness and Analyze Your Audience

Once the subcommittee has a good understanding of its goal, the hard work begins. The first step is to truly understand the workforce you are trying to help. “One of the advantages of working on this from the retirement plan perspective is that we can access data that shows how participants are behaving inside the plan, Stout says.

Next, analyze your audience, she advises. Stout recommends using focus groups as a great way to get firsthand comments about what the workforce finds important.

Tip #3: ‘If You Don’t Know Where You’re Going, Any Road Will Get You There’

It’s important to have a written plan, Stout asserts, along the lines of an Investment Policy Statement, to keep the committee on track and keep emotion out of the decision-making process.

Tip #4: ‘It Takes a Village’

“This is a huge endeavor,” Stout notes. “Unless you have millions of dollars to invest in technology and apps and nothing else on your plate, you will need to find your ‘village people’ to join in on this.” In particular, the plan provider is a critical partner if the strategy is to be successful. They hold the keys to the data and have invested millions of dollars in tools and resources to help educate participants.

Others to consider recruiting include a member of the company’s marketing department, who can offer creativity and can be helpful when you get to the communication piece of the strategy; and a third-party financial wellness partner.

In addition to Stout’s regular “Inside Financial Wellness” column, the Winter 2015 issue of NAPA Net the Magazine includes the cover story on making the ROI connection between the bottom line and employee well being, as well as feature articles on robo-advisors’ entry into the 401(k) market and preparing for the SEC’s coming money market reforms. The issue also features insights from regular contributors Jerry Bramlett, Steff Chalk, Nevin Adams, David Levine, Brian Graff, Don Trone, Joseph DeNoyior, Warren Cormier, Fred Barstein and Lisa Greenwald Schneider.

To view Stout’s column, click here and select “4 Keys to Implementing a Financial Wellness Strategy That Works.” And to view a pdf of the full 52-page issue, click here.

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