For years there’s been lots of talk about the benefits of financial wellness programs – employees learn how to address financial issues including retirement and debt burdens, and employers, as a result, have more productive and happy employees. But to date the financial wellness market hasn’t really taken off.
Only 24% of U.S. employers have financial wellness programs, according to the Bank of America Merrill Lynch 2015 Workplace Benefits report, and even that number may be an exaggeration.
“The reality is there are relatively few true financial wellness programs in place today but many financial education or financial literacy programs,” says Kent E. Allison, a partner at PwC and a national leader in its Employee Financial Wellness Practice. “But there is a lot of talk and interest in financial wellness programs.”
The difference between financial education/literacy and financial wellness is like the difference between reading articles on saving for retirement and developing a personal financial plan to do that, with or without a financial advisor.
But financial education and literacy can lead to personal financial advisory relationships and potentially more clients for financial advisors.
Marcos Lira, founder and owner of 360 Dividends, a financial advisory firm in San Jose, California, just landed his first financial wellness contract, with a local nonprofit organization, and will offer employees four quarterly workshops on financial topics plus two personal financial coaching sessions per year if they’re interested.
“I view this as a great opportunity to offer my services and experience,” says Lira. In addition to collecting a check from the employer, Lira hopes the program will lead to referrals for more business and to new clients when employees leave the nonprofit. Lira doesn’t pursue current employees at the organization as outside clients because he says he doesn’t want to have any conflicts of interest.
Steven Krzywicki, of Beacon Bridge Wealth Partners, a financial advisory firm in Conshohocken, Pennsylvania, says, “It’s the educational component [of financial wellness programs] that will attract clients.” Financial educational workshops and seminars are “always an opportunity to engage more in a one-to-one relationship if that’s appropriate,” says Kryzywicki, whose firm is part of the Ameriprise Financial Services network.
Beacon Bridge has been working with a national tech company with an office nearby, providing a mix of educational financial seminars on retirement as well as one-to-one consulting sessions with employees facing retirement in the next five years. After one year a number of employees hired his firm for an ongoing engagement, says Kryzywicki.