Version from client

1. CHRO
DRAFT
Financial Wellness:
The Untapped Lever
Aimee DeCamillo

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CHRO
DRAFT

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CHRO
DRAFT
Source: T. Rowe Price Retirement Plan Services, Inc. as of 9/30/2015
Priorities in the C-Suite Converge
Providing Strong
Benefits &
Compensation
Retaining
Talent
Engaging
Employees

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CHRO
DRAFT The Retirement Crisis in a Nutshell
Less than $10,000 save
for retirement
(USA Today 2014)
52%
Average participant
contribution vs.
recommended 15%
7.8%
Participants who borrow
against their 401(k)
(T. Rowe Price 6/30/2015)
24%
Source: T. Rowe Price Retirement Saving and Spending Study (2015)

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CHRO
DRAFT Why? The Vicious Cycle
Source: T. Rowe Price Retirement Saving and Spending Study (2015)
Say they can’t
afford to save more
(T. Rowe Price Retirement
Saving and Spending Study
2015)
48%
Live paycheck to
paycheck
(CNNMoney 2013)
70%
Of paycheck goes to
consumer debt
payments
(U.S. Census Bureau et. al.
2014)
24%
Can’t cover a $1,000
emergency without
borrowing
(MarketWatch 2015)
64%

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CHRO
DRAFT
The Result: Lots and lots of stress
Say finances are the largest source of stress in their life
(American Psychological Association 2015)
64%

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CHRO
DRAFT What’s the Cost?
Financial Stress Related Issue Cost Per Incident Total Cost
Absenteeism $3,600 $2,520,000
Productivity (20 hours/month) $7,000 $1,750,000
Present-eeism (6 hours/month distracted) $2,000 $500,000
Accidents (23 stress-related/year) $29,000 $667,000
Turnover (40% Stress-related) $3,500 $210,000
Ethics (Theft, 4.2% of employees) $1,700 $18,500
 Bottom Line: Over $5.6 million per year
Source: Pension Consultants Inc. 2014

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CHRO
DRAFT What is Financial Wellness?
Save for Tomorrow
Take Care of Today

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CHRO
DRAFT The Financial Wellness Spectrum
 Trust & Estate
 Income Planning
 Long term savings needs
 Investing
 Debt management
 Budgeting
 Emergency preparedness
FOUNDATIONAL
INTERMEDIATE
ADVANCED

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CHRO
DRAFT #1 Reason for Providing Financial Wellness
of plan sponsors said they want to provide some
type of financial wellness offering because…
85%

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CHRO
DRAFT
Source: Aon Hewitt 2016 “Hot Topics in Retirement” Study
It’s the right thing to do.
#1 Reason for Providing Financial Wellness

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CHRO
DRAFT Major Objectives of Financial Wellness Initiatives
Retaining skilled
employees
74%
Increasing
employee
satisfaction
69%
Improving
employee
productivity
67%
Competing effectively
for skilled
employees
64%
Source: T. Rowe Price Plan Sponsor Survey 2016

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CHRO
DRAFT
Factors to assess:
 Retirement plan data
 Workforce profile and demographics
 Business symptoms of “unwellness”
 Culture and benefits philosophy
Do You Need Financial Wellness?
96%
66%

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CHRO
DRAFT Styles of Financial Wellness Providers
 Tools
 Education and Literacy
 Product-Based Services
 Coaching and Behavioral Programs

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CHRO
DRAFT Considerations for Selecting a Provider
Budget or cost
Business model
Communication frequency
Multi-media resources
Data reporting capabilities
Integration with other benefits

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CHRO
DRAFT Integrating Financial Wellness
DIGITAL
IN PERSON PRINT

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CHRO
DRAFT Financial Wellness Works for Employees
20%
29%
34%
5%
12%
33%
Overwhelming Stress High Stress Some Stress
FINANCIAL STRESS
FINANCIAL DISTRACTIONS AT WORK
37%
18%
21%
12% 13%
22%
Very Often
Distracted
Often Distracted Sometimes
Distracted
At start of program 2-5 years later
IMPROVED EMOTIONAL
OUTLOOK
RETIREMENT PREPAREDNESS
39%
Program participants who are
saving 15% of their salary for
retirement after 2 years in the
program
Source: SmartDollar, 2015.

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CHRO
DRAFT
 1,000 employees
 $200,000 investment in program
 $624,250 total savings
 Bottom line: Over 300% return
Source: Garman, E. T. Personal Finances and Worker Productivity, Proceedings of the Personal Finance Employee Education Best
Practices and Collaboration
Financial Wellness Works for Employers

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CHRO
DRAFT
Source: Aon Hewitt 2016 “Hot Topics in Retirement” Study
It’s the right thing to do.

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CHRO
DRAFT
Thank You
C1ESEDIA2
2016-US-26405 9/16
T. Rowe Price Investments Services, Inc.