Deepen relationships by helping plan sponsors tackle participants’ financial stress

Professional guidance fuels better outcomes

Our findings show a clear connection between workers’ actions, their financial situation, and their level of stress—and your guidance plays a big part.

Source: John Hancock's 2023 stress, finances, and well-being report.

Adding value without adding cost to your bottom line

Partnering with your clients’ retirement plan provider is perhaps the easiest and most cost-efficient way to expand your participant education and financial wellness offering. Most offer ready-made presentations, flyers, worksheets, and digital tools on a broad range of financial topics that you can use—at no added cost to your practice. In some cases, they may also be willing to help you put an education strategy together for a particular client or conduct joint webinars. So make sure you’re taking advantage of this valuable resource.

Enhancing your participant education offering

You want the education and tools you provide to be relevant. Many workers are struggling to balance their current financial needs with saving for retirement, which can encompass a host of different topics. Through our daily calls with participants and survey results, we’ve identified three topics for you to focus on, assuming you’re not already.

1 Managing expenses in an unpredictable economy

In 2022, more than 40% of the calls to our participant services centers were about distributions and another 13% were about loans.¹ These numbers aren’t that surprising when you consider that the majority of participants (90%) have seen their cost of living increase over the past year due to inflation and rising interest rates. Many are looking for extra funds to pay for groceries, gas, and monthly bills—and, for some, this means tapping into their 401(k). While this action is understandable, and sometimes necessary, it can throw a participant’s retirement savings off track for weeks, months, or even years.

Consider hosting a series of in-person or virtual workshops to help participants manage their expenses in this economic climate. You could discuss: 

• Strategies for covering daily living expenses
• The types of 401(k) withdrawals and their potential tax consequences
• Factors to consider before requesting a distribution
• The importance of emergency savings and ways to build it
• Budgeting basics

With a better understanding of their options, participants may be more likely to leave their retirement savings alone.

2 Creating a retirement income strategy

One of participants’ greatest fears is running out of money in retirement, which may be why 42% would like employers to help them forecast how much income they’ll need, and 41% would like help with Social Security strategies.

Many service providers now include estimates of retirement income on their participant statements and websites, so forecasting is covered. Your discussions should focus on helping participants understand what these numbers mean, which could include:

• Tips for estimating retirement expenses
• Ideas for closing their retirement gap
• Sources of retirement income
• Key considerations for taking Social Security
• Overview of drawdown strategies

3 Understanding financial basics, including will and estate planning

Additionally, we learned that slightly more than a third of participants would like their employers to help them assess their financial wellness. To help address this need, you could host a series of personal finance 101 workshops that include smart money habits for:

• Saving and investing
• Planning for retirement
• Managing debt
• Insurance planning
• Will and estate planning

These sessions could complement the service provider’s financial wellness assessment tools and serve as a road map for participants, helping them learn what they’re doing right and potential steps they could take to close any gaps.

One area of particular interest is will and estate planning. More than a third of participants (35%) would like employers to provide access to will and estate planning experts. So, for that workshop, you might consider teaming with an estate planning attorney to add credibility and insight to your discussion. If you don’t have an established relationship with one, check with the wealth management advisors in your office, as they likely have some connections.

Make participant education one of your differentiators

If expanding your education offering isn’t part of your 2023 business strategy, it warrants consideration. Participants want help taking control of their finances—in large part so they can figure out how to save and invest more for retirement and other goals—and they’re looking to plan sponsors for this assistance. Providing your clients with this support can help you strengthen your relationships and stand out in an industry that’s becoming increasingly commoditized. And participants appreciate what you have to say—60% consider the information they receive from financial professionals when making financial decisions. So if you’ve ever wondered if you’re making a difference—you are.

Get more insight in our 2023 stress, finances, and well-being report.