Check out the top trends that employees are looking for in an employer wellness programs by Page Elliott.
With open enrollment in the rearview mirror, many benefits professionals have been able to see which new wellness benefits have been a hit and which have been a miss. Increasingly, employees expect the benefits on offer to go beyond physical health and exercise and extend into a broader concept of wellness.
Meeting this appetite can benefit employers significantly — research has shown happier employees are considerably more productive.
The industry has answered the call in recent years and employers and brokers are bringing more and more benefits to the table that offer employees tools to better navigate their lives domestically, at work and in general.
Here are the top seven benefits to consider for upcoming enrollment periods that help look after employees personal well-being beyond the purely physical.
There are a multitude of reasons why employees often require costly legal representation: divorce, financial woes, neighborly disputes, property transactions, estate planning, etc. For most employees the costs and time required to attend to these issues are financially and emotionally draining.
The added stress created can cause a substantial loss in productivity in the workplace. As such, legal protection benefits are increasingly seen as an important step to keep a company’s workforce well and thriving.
According to a 2016 survey by Willis Towers Watson, 59 percent of employers now offer legal plans as a voluntary benefit.
According to a study by Northwestern Mutual, some 58 percent of Americans believe their financial planning needs improvement and money remains the leading cause of stress in America today.
Offering financial coaching can be a bedrock voluntary benefit for employers given that it is central to protecting employees from falling into the kind of dire straits where other benefits like legal protection need to be used.
Financial coaching can help employees with everything from building a monthly budget that gets them back in the black, to planning their college fund or retirement saving more carefully. Financial coaching as an employee benefit can help employees thrive instead of just survive.
Identity theft is fast becoming the third certainty in life — according to the Bureau of Justice Statistics, nearly 18 million people fell victim to identity theft in 2014 (that’s seven percent of U.S. adults in just one year).
Identity theft leads to financial and healthcare fraud that can be a crippling mess for victims to unravel and take many years (and many work hours!). The emotional effects of identity theft are well documented and easy to understand: anger, frustration and feelings of violation and vulnerability and the corresponding impact on wellness are clear.
Identity theft remediation and monitoring services can provide employees with critical resources to handle the frustrating complexities of rectifying fraud conducted using their own identities.
While a healthy chunk of all our paychecks goes towards paying for our health care insurance and services — a fiendishly complex and constantly evolving ecosystem — many Americans don’t understand the most basic terms.
Health advocacy has been a growing voluntary benefit over the last few years because it can help employees navigate a complex and exhausting system, offering both administrative and even clinical support. Health advocacy can reduce employee anxiety, improve overall wellness through better heath decisions and also help consumers get a better financial deal from their health care choices.
Research indicates that meditation has substantial benefits in terms of encouraging better attention, memory and emotional intelligence (and who couldn’t use some more of each on a daily basis?)
Mindfulness has been a top topic for HR pros for a long time, and many have made big strides in incorporating this concept into corporate culture. This has included encouraging employees to try extra-curricular relaxation techniques like yoga and meditation.
Some companies have gone as far as offering apps like Headspace to employees as a voluntary benefit at low or no cost.
The prevailing wisdom relating to employees’ personal problems has always been stay well out of it. However, more and more companies are seeing the upside of providing assistance to employees without getting directly involved in their personal lives.
One increasingly popular method for helping people manage the conflicts that exist in their lives outside of the office is to offer relationship counseling. While this remains a rarity on most voluntary benefits portals, expect to see this popping up more and more in subsequent open enrollment periods.
According to a survey by Care.com, over 70 percent of employees say the cost of childcare impacts their career decisions. Not wildly surprising given that nearly a third of families pay in excess of $20,000 per annum for child care — a figure that represents a shockingly high portion of the average U.S. household income of around $52,000.
Related: Are you ready for the millennial baby boom?
Offering dependent care deduction has been a popular benefit for a number of years and more and more parents are taking this up as part of their flex spending arrangements. Assistance can go beyond the tax break though and a growing number of companies are offering services that can make managing child care vastly easier, including child care resource and referral services that can help with back-up arrangements when daycare centers are closed.
See the original article Here.
Elliott P. (2017 March 21). 7 wellness benefits to maintain employees’ zen[Web blog post]. Retrieved from address http://www.benefitspro.com/2017/03/21/7-wellness-benefits-to-maintain-employees-zen?kw=7+wellness+benefits+to+maintain+employees%27+zen&et=editorial&bu=BenefitsPRO&cn=20170326&src=EMC-Email_editorial&pt=Benefits+Weekend+PRO&page_all=1
Good things come to those who wait…. except when understanding your benefits. The sooner employees become educated on why they have unique benefits, the sooner they will put them to use!
“Those who don’t understand benefits, don’t utilize them correctly. They are not good consumers of health care.” – Scott Smeaton, Hierl Executive Vice President.
It is important to understand your employee benefits not only for your own health reasons, but also so that you are able to recognize why your employer offers the unique benefits they do.
What differentiates Hierl and how they help effectively communicate benefits?
At Hierl, we look at each client as unique. What works best for one may not be ideal for another. It’s about really being able to understand the culture and provide different communication options such as presentations, visuals, emails, and website.
Hierl shines when it comes to giving employers/employees access to all forms of communication, specifically in the communication campaigns run throughout the year. By assessing the necessary points to communicate and then building quarterly and monthly campaigns around these objectives, Hierl brings unique, strategic solutions to explaining employee benefits. The evidence of communication strategies at work is apparent in the results gathered from clients.
“One of the ways companies can measure the success of their program is to measure employee satisfaction. By measuring employee satisfaction after communication campaigns, findings show that the more regularly benefits are communicated, the higher employee satisfaction goes up!” – Scott Smeaton
3 Key Points on Communicating Benefits
To download the full article click Here.
Did you know that your emotional and physical well-being can take a hit when you are under financial stress? Here is an interesting article from Employee Benefits Advisors about the correlation between financial stress and mental and physical health by Amanda Eisenberg.
Americans aren’t able to save for their financial goals, and that stress is affecting their emotional and physical well-being.
A new study by Guardian Life Insurance found that financial outlook is the most significant driver of working Americans’ overall well-being, constituting 40% of the insurance company’s Workforce Well-Being Index, and money is cited as the No. 1 source of stress for a majority of workers.
“Even among people working full-time with benefits, many still do not have access to adequate insurance coverage or retirement plans,” says Dave Mahder, vice president and chief marketing officer of Guardian’s Group and Worksite Markets business. “And few take advantage of the health and wellness programs available through their employers, which often contain a much broader menu of resources than workers realize.”
Millennials are one of the subsets of employees who do participate in benefits that can help alleviate financial stress, the survey found.
“Millennials want marketing to them,” says Gene Lanzoni, assistant vice president of thought leadership for Guardian Life. “It’s not enough these days to say, “This is someone like you,” to do with your benefit selection. That’s what the challenge is for millennials. It’s not enough of an engaging process for them.”
Half of millennials surveyed in Guardian Life’s “Fourth Annual Guardian Workplace Benefits Study” said they don’t have disability insurance, while a third have yet to sign up for a retirement plan.
They are not the only group of employees struggling to purchase voluntary benefits like disability and life insurance; single working parents are also feeling the heat.
One in three single working parents does not have a retirement plan, compared to 20% of the 1,439 workers surveyed. Similarly, one in four workers doesn’t have life insurance, and one in three workers doesn’t have disability insurance, according to the survey.
“Many of those working parents are struggling to balance work and personal life, and they may not be able to afford some of the protection products,” says Lanzoni. “Some of that discretionary income might not go toward paying a voluntary disability plan.”
To offset expenses, Americans are increasingly turning to debt, whether through loans or credit cards, to temporarily relieve their financial burdens.
Four in 10 Americans have car loans, 32% of workers are carrying a mortgage, 17% have student loans and 12% have home improvement debt, according to the study. Overall, 75% of Americans are carrying debt.
Non-mortgage debt — particularly auto and education loans — contributes to lower financial wellness; those carrying the most total debt, including mortgages and rent, report considerably lower overall well-being, according to Guardian Life’s report.
Employers can also help alleviate the burden by providing education to employees, among other services, says Lanzoni.
The survey found that employer-sponsored voluntary insurance products and college tuition or loan repayment programs help with financial wellness, as well as employee assistance programs that can identify financial, emotional and physical issues that lead to stress.
Eisenberg A. (2017 March 13). Financial stress hurts emotional, physical well-being of workers [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/financial-stress-hurts-emotional-physical-well-being-of-workers?feed=00000152-1387-d1cc-a5fa-7fffaf8f0000
Great article from SHRM about the importance of educating your employees about their social security by Irene Saccoccio.
Social Security is with you throughout life’s journey, and we want to put your employees in control of their finances and future. With the tax filing deadline quickly approaching, everyone needs to make sure all their ducks are in a row before they file. Do your employees know that Social Security benefits may be taxable?
It’s true. About forty percent of people receiving Social Security benefits must pay taxes on some of these benefits, depending on the amount of their taxable income for the year. This includes all monthly retirement, survivor, and disability benefits. This may happen if your employees have other significant income in addition to their Social Security benefits.
The good news is that it’s easy to find out whether they must pay taxes on their benefits. All your employees need to look at their Social Security Benefit Statement (Form SSA-1099/1042S). An SSA-1099 is a tax form Social Security mails each year in January to people who receive Social Security benefits. It shows the total amount of benefits they received from Social Security in the previous year so they know how much Social Security income to report to IRS on their tax returns.
Your employees should automatically receive this form. If they don’t receive their Benefit Statement or misplaced it, no need to worry. A replacement SSA-1099 or SSA-1042S is typically available for the previous tax year after February 1. Even better news, Social Security has made requesting or replacing an annual Benefit Statement even easier. Now everyone has the ability to download it anytime and anywhere by using our online services.
Your employees can go to our my Social Security page, and select “Sign In or Create an Account.” Once they are logged in, they should select the “Replacement Documents” tab to obtain a replacement 1099 or 1042S benefit statement. Your employees can also use their personal my Social Security account to keep track of their earnings each year, manage their benefits, and more.
Your employees can also obtain a replacement benefit statement by calling us at 1-800-772-1213 (TTY 1-800-325-0778), or contacting their local Social Security Office. People living outside of the United States, need to contact their nearest U.S. Embassy or Consulate.
Handling tax season is all about what you know. Encourage your employees not to wait. They should open a personal my Social Security account today. In addition to getting a SSA-1099 or 1042S, there are many other tools like their Social Security Statement or benefit verification letter that can help them today. Just another way in which Social Security helps them secure today and tomorrow.
Saccoccio I. (2017 March 24). What your employees should know about social security benefits and taxes [Web blog post]. Retrieved from address https://blog.shrm.org/blog/what-your-employees-should-know-about-social-security-benefits-and-taxes
Do you need help boosting involvement in your retirement program? Take a look at this great article from Benefits Pro about how digital media can be the perfect vehicle for increase enrollment in your retirement program by Marlene Satter.
Retirement plan providers need a new approach—literally—when it comes to engaging millennials: going digital.
According to a blog post from Corporate Insight, millennials use, or seek to use, technology and mobile platforms to manage as many aspects of their lives as possible. But when it comes to retirement plans, many can’t.
While millennials are not only much more likely to value mobile access to their 401(k)s than their parents are, plan providers haven’t been as enthusiastic.
A Corporate Insight survey found that 57 percent of millennials consider the ability to manage their retirement plan account via a mobile app “very important” or “extremely important,” versus just 26 percent of baby boomers, but only 10 of the 19 leading retirement plan providers Corporate Insight tracks offer any kind of transaction capabilities via their iPhone apps.q
And that, considering millennials’ preferences, is a failure.
Although it’s considerably better than it was only four years ago, when only two out of 17 firms provided such service, the post says, “the industry has yet to reach the standard set by other financial industry verticals, like banking and brokerage, where mobile transaction functionality is the new normal.”
It’s true that many retirement plan providers have recently introduced mobile apps, but those apps have only limited capabilities compared with the functionalities millennials are looking for.
Then there’s the little matter of advice and education. Thanks to the Great Recession, millennials have a low risk tolerance and tend to stick to very conservative investments.
In addition, they “highly value advice and are not receiving enough of it,” the post says. With millennials the most likely of all generations to seek some degree of professional advice, at 89 percent compared with 78 percent of boomers, only 58 percent say they have been offered this assistance.
Of course, even among those offered advice, just 59 percent have actually taken advantage of it—possibly because they perceive it as expensive and don’t realize that the plan sponsor may be footing the bill instead of the employee.
Better communicating the menu of options available to employees could correct misperceptions, as well as alert employees unaware of the option to its availability.
Millennials are also more open to managed accounts, and those who have them are likely to say they’re satisfied or very satisfied with them.
Fintech firms offering low-cost robo options could boost the participation of young people in their retirement accounts, and as a means of customization they could be key to improving the results of defined contribution retirement accounts in helping employees prepare for retirement.
Satter M. (2017 March 24). Digital approach to millennials can boost retirement savings participation [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/03/24/digital-approach-to-millennials-can-boost-retireme?ref=hp-news
Did you know that there is a direct corelation between financial and physical health? This article from Benefits Pro is a great read explaining the link between an employee’s financial and physical health by Caroline Marwitz
LAS VEGAS — Are poor physical health and poor financial health connected? The benefits industry is making the link, if you consider how many deals between health-related benefits companies and retirement providers have occurred lately.
Obviously, the poor, at least in America, have a more fragile state of health than the more affluent. And as we age, the potential for unplanned health events to hurt us financially increases — and that’s important for retirement advisors and plan sponsors to remember. But what about your typical employees who are neither poor nor elderly?
A study in the journal Psychological Science looked at worker attitudes and actions to find out whether poor physical health and poor financial health might be linked, and how.
The researchers studied employees who were given an employer-sponsored health exam and were told they needed to change certain behaviors to improve their health. Which employees made the changes and who blew them off?
The researchers accounted for external factors such as different levels of income and physical health, and differences in demographics. Yet the results were still startling:
“Employees who saved for the future by contributing to a 401(k) showed improvements in their abnormal blood-test results and health behaviors approximately 27% more often than noncontributors did,” the researchers concluded in Healthy, Wealthy, and Wise: Retirement Planning Predicts Employee Health Improvements.
The employees who made the behavior changes to better their physical health were also the ones who were taking action to better their financial health.
Employee attitudes about the future and how much control they have over it affect whether they take care of their physical health and their financial health. That sense of control, or conversely, that feeling of no control, and thus, no investment in long-term results, is one reason why some employees might not participate in retirement plans, and, maybe, wellness and well-being programs.
What if, along with the retirement health-care cost calculators many retirement plan providers offer, there was a fatalism calculator too? That way you could see right away each person’s sense of control or feelings of inevitability about their future and help them more efficiently.
Because if someone is more fatalistic, telling them about their 401(k) match or pension options isn’t going to make them enroll in a retirement plan. Scaring them with statistics about the high costs of health care in retirement isn’t going to do the trick either. Instead, consider the following points for such employees:
Look behind employee behavior for the unexamined biases and long-held assumptions that are causing it. If they can see that it’s not who they are that determines their future but what they do, it’s a start.
Marwitz C. (2017 March 19). Employee financial health connects to physical health [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/03/19/employee-financial-health-connects-to-physical-hea?ref=hp-top-stories
With many companies taking employee education and training into their own hands employers must be properly prepared for the changing future. Check out this great article from SHRM about what employers must do to keep pace in the ever evolving workplace by Ross Smith and Madhukar Yarra
We live in a world where phenomena such as the internet, globalization, social media, and mobility are accelerating change faster than ever before. Today’s digital age fed by big data is manifested in new businesses disrupting existing business models, which are remnants of the industrial era. These new models, typified by the Ubers, Amazons, Teslas, Airbnb’s and Facebooks of the world, are fossilizing the older generation of companies.
It is difficult for the education system to keep pace with this kind of change. The education system is a behemoth whose design is evolving to address the need for agility and speed. They change after the fact and therefore almost always take refuge in ‘best practices’. The MBA as we know it, has also fallen prey to this.
The MBA has been designed to provide a pool of mid-level managers for large corporations and questions arise about the future. Armed with an MBA, new hires walk into a large corporation with a desire to prove their worth through a strong knowledge of historical best practices. They may miss the value of ‘first principles’ thinking, and more often than not, face challenges to make an impact. Over time, this can create a disconnected or disillusioned workforce.
The question then becomes – if emerging and disruptive business models no longer subscribe to historical best practices, and by extension, to business schools, as their source for leadership, where should they look? What is that institution or model that allows individuals to build decision making capabilities in today’s world?
The reliance on irrelevant frameworks, outdated textbooks, and a historical belief in “best practices” all run counter to how a leader needs to be thinking in today’s fast paced digital world. There are no established best practices for marketing in a sharing economy or creating a brand in a digital world. The best practices might have been established last week. The world is moving fast, and leaders need to be more agile. Today, Millennials are leading teams, calling the shots in many corporations, which means that the energy created is one that leaves little time for rules and structures to effectuate and/or create impact. Making good decisions in today’s business world requires a new and different kind of thinking, and there are tactics that can help grow these new types of leaders.
Importance of questions: most leadership and business programs today evaluate and assess students based on answers, not the ability to ask good questions. Thoughtful and incisive questions lead to innovation and as business problems become more granular and interconnected, this skill will help leaders arrive at better decisions.
Experimentation over experts: Students are encouraged to seek “expert advice” rather than formulating their own hypotheses that can be tested as low cost experiments. While consulting with those who have walked the same path has its benefits, relying on the experiences of others may hinder growth, particularly when change is accelerating. The shift to globalization, digitization, social, and agile are changing rapidly, there is no “right answer”, so experimentation is a crucial skill.
Interdisciplinary perspective: Disciplines and industry sector models are glorified at a time when discipline barriers are being broken to create new ideas. A conscious intermingling of disciplines creates more fertile minds for innovative thoughts to occur.
In today’s management programs, outdated content and old-school delivery mechanisms are limiting students and businesses alike. There is a dire need to help business and young talent alike embrace a new art of problem solving, essential for the realities of today.
Many companies are starting to take education and employee training into their own hands. The advent of online courses, MOOCs, and other innovative programs in employee education are supplementing traditional education.
HR professionals can learn from companies who have set up their own deep technical training programs. With the work they do to augment decision science skills, Mu Sigma University is a great example of a modern day tech company, building skills across technology, business, analytics, and design. The workforce is changing. Many traditional jobs are being replaced with automation, robots, cloud-based machine learning services, and artificial intelligence – while at the same time, the demand for high end engineering, analytics, business intelligence, data and decision science is booming. Many companies, such as Mu Sigma, are spinning up advanced technical training investments to ensure their employees are equipped for a rapidly evolving future.
Smith R. & Yarra M. (2017 March 15). What it takes to make good decisions in the new world of work [Web blog post]. Retrieved from address https://blog.shrm.org/blog/what-it-takes-to-make-good-decisions-in-the-new-world-of-work
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Do you know which question you can ask any employee requesting FMLA leave? Look at this great article from HR Morning about what employers can and cannot say to an employee on FMLA leave Christian Schappel
You know when employees request FMLA leave, those conversations have to stick to the facts about what the workers need and why. The problem is, a lot of managers don’t know that — and here’s proof some of their stray comments can cost you dearly in court.
Three employers are currently fighting expensive FMLA interference lawsuits because their managers didn’t stick to the facts when subordinates requested leave.
The real kick in the pants: Two of the lawsuits were filed by employees who’d received all of the FMLA leave they requested — and the courts said the interference claims were still valid. How’s that even possible? Keep reading to learn about the latest litigation trend in the FMLA world.
Here’s what happened in each case (don’t worry, we’ve cut to the chase in all of them) — beginning with the words/phrases managers must avoid when a worker requests leave:
James Hefti, a tool designer, was in hot water with his company, Brunk Industries, a metal stamping company.
Reason: Let’s just say he called a lot of people at work “my b____.”
After he ignored multiple warnings from management to stop using obscenities at work, the company planned to fire him. But it didn’t pull the trigger immediately.
Then, just prior to his termination, Hefti requested FMLA leave to care for his son, who was suffering from various mental health problems.
His manager, upon hearing of Hefti’s request, told him Brunk paid for his insurance and thus expected him to be at work.
When Hefti was fired a few days later, he sued for FMLA interference.
The company tried to get the suit thrown out, claiming his conduct and ignorance of repeated warnings gave it grounds to terminate him. But it didn’t win.
The court said the manager’s interactions with Hefti did raise the question of whether he was fired for requesting FMLA leave, so the judge sent the case to trial.
Cite: Hefti v. Brunk Industries
Lisa Kimes, a public safety officer for the University of Scranton’s Department of Public Safety, requested FMLA leave to care for her son, who had diabetes.
Kimes was granted all the time off she requested. But in a meeting with her supervisor she was told that since the department was short staffed it was “inconsiderate” of her to take time off.
When her relationship with the department soured, she sued claiming FMLA interference.
The department tried to get her suit tossed before it went to trial. It had a seemingly reasonable argument: She got all of the leave she requested, so it couldn’t have interfered with her FMLA rights.
But Kimes argued that her supervisor’s comments prevented her from requesting more FMLA leave – thus the interference lawsuit.
The court sided with Kimes. It said she had a strong argument, so the judge sent her case to trial as well.
Suit: Kimes v. University of Scranton
Judy Gordon was an officer with U.S. Capitol Police when she requested intermittent FMLA leave for periods of incapacitating depression following her husband’s suicide.
But before Gordon used any FMLA leave, a captain in the police department told her that an upper-level manager had said he was “mad” about FMLA requests in general, and he’d vowed to “find a problem” with Gordon’s request.
Then later, when she actually went to take leave, her manager became irate, denied her request and demanded a doctor’s note. He later relented and granted the request.
In fact, she was granted all the leave she requested.
Still, she filed an FMLA interference suit. And, again, the employer fought to get it thrown out before a trial on the grounds that Gordon had no claim because all of her leave requests were granted.
But this case was sent to trial, too. The judge said her superiors’ conduct could have a “reasonable tendency” to interfere with her FMLA rights by deterring her from exercising them — i.e., the comments made to her could’ve persuaded her not to request additional leave time to which she was entitled.
Suit: Gordon v. United States Capitol Police
Based on a thorough read-through of the court documents, each of these employers appeared to have a pretty good chance of winning summary judgment and getting the lawsuits thrown out before an expensive trial — that is, if it weren’t for the managers’ stray comments in each.
These cases have created two important teaching points for HR:
The best way to stay safe: Re-emphasize that managers must stick to the facts when employees request FMLA leave, as well as keep their opinions and other observations to themselves.
Schappel C. (2017 March 17). 3 things managers can’t say after FMLA requests [Web blog post]. Retrieved from address http://www.hrmorning.com/3-things-you-cant-say-after-fmla-requests/
Have you ever thought about the future of employee benefits advisors? Take a look at this interesting article from Benefits Pro about the growth of robotic employee benefits advisors by Caroline Marwitz
LAS VEGAS — Some advisors see robo-advisors as a competing force.
At the NAPA 401(k) Summit, you might expect some hostility to the concept. After all, the market for algorithm-based, non-human decision-making robo-advisors is expected to grow.
Business Insider’s research service, BI Intelligence, forecasts that by 2020, robo-advisors will manage $8 trillion in assets.
But the questions for two executives at two robo-advisor firms during a technology panel demonstrated more curiosity than hostility. Betterment for Business’s Cynthia Loh and blooom’s (yes, three Os) Chris Costello fielded them and got in some marketing in the process.
The questions ranged from whether advisors can get data and metrics about results (yes), how good is the security and encryption of participant information (as good as a bank’s), whether rebalancing is participant-driven (no), whether there was a process to update employee risk tolerance and other information over time, as it changes (yes), to whether these robo-advisors partner with advisors to offer compensation (Betterment: yes, we have a separate arm of the business for that; blooom: ten dollars per participant doesn’t make a partnership conducive, though advisors can offer this service to differentiate themselves to plan sponsors).
The common wisdom is that robo-advisors, at least in the retirement industry, are aimed at people with fewer assets.
However, in the wider investment industry, the BI Intelligence research report noted: “Consumers across all asset classes are receptive to robo-advisors — including the wealthy. 49% of this group would consider investing some of their assets using a robo-advisor.”
For blooom, its market is not intended to be the wealthy, CEO and cofounder, Chris Costello, said, but rather “the people who don’t understand stuff.”
“All the way up the food chain, people are messing up their 401k plans,” Costello said. “We are targeting a segment of market most advisors aren’t targeting, most are well below 250,000 dollars.”
The stereotypical user of a robo-advisor is, of course, a millennial. But now, said Betterment’ for Business GM Cynthia Loh, “Everyone expects technology.” Even the clients have changed, she said. Where in the past it might be a tech company, within the last year companies of other kinds have come on board — medical, legal, and financial services firms.
Taking aim at the traditional, minimalist way many employers offer information on retirement plans, Costello noted that there are always going to be employees who like to study their options and do their homework. “But that is not most Americans. Most Americans need this to be done for them. When I had wealthy clients, I didn’t tell them to go home and study up. We did the work for them. This brings the services that wealthy people have been getting for decades.”
Still, Loh added, Betterment embraces both the technology and the human side. “We recognize there’s always going to be a place for human advice.”
Because ultimately it comes back to the human side, not the technology side. Of course, the technology behind the algorithms is important. But something as warm and fuzzy as the participant questionnaire is also crucial.
In fact, recent guidance on robo-advisors from the Securities and Exchange Commission concerns itself with a robo-advisor’s questionnaire. Which makes sense, as it’s the information the algorithms use to make their decisions and the basis of their advice. Garbage in, garbage out. And the ability, which both firms offer, to consult with a human advisor, whether it might be by phone or by chat, is also important, at least to what we know about what plan participants want.
And the Department of Labor’s fiduciary rule has made many in the retirement industry feel that knowing as much as possible about a participant or client is key to successfully helping them as well as being in compliance.
Marwitz Caroline (2017 March 19). Is industry coming around to robo-advisor concept [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/03/19/is-industry-coming-around-to-robo-advisor-concept?ref=hp-top-stories