Voluntary Benefits: Sponsors Want Them … Can You Deliver?
There’s good reason to believe that if you’re not talking about voluntary benefits with your sponsors, you’re missing a chance to help them and help yourself.
Voluntary benefits like retirement plans, life insurance, and disability income insurance are a big deal, especially now that benefits tend to be employer-enabled rather than employer-provided. Employers need to choose which benefits they offer their employees in an increasingly-complex financial environment – and it’s likely they want your help to do it.
In fact, two out of five employers that currently don’t rely on an advisor say they would welcome voluntary benefits help from an experienced financial professional, according to the 2016 MassMutual Benefits Advice Study1. The study found that 39 percent of employers without an advisor would find that advice “extremely valuable” or “very valuable” and more than half of those surveyed would find it at least “somewhat” or more valuable.
Employers that do rely on an advisor for help with voluntary benefits tend to put greater focus on their importance: 61 percent of employers relying on an advisor encourage employees to take advantage of their voluntary benefits, compared with 49 percent of those that don’t use an advisor.
Plus, those employers generally rate the advice they receive as “excellent” or “very good” (53 percent), while 77 percent rate it as “good” or better. And value and satisfaction both go up with the size of the employer: as the employer’s size grows, so too does the value placed on things like employee wellness programs and benefits utilization, as well as the employer’s satisfaction with the guidance received.
A HOLISTIC NEW WORLD
The word “holistic” isn’t just attached to yoga anymore. It’s being applied to financial planning in terms of providing services to cover a range of needs, not just specific areas.
(Related: What Holistic Planning Does)
In that environment, the mindset around voluntary benefits has to change to a more holistic view, helping employers provide a range of benefits for their employees and subsequently helping employees understand what benefits are right for them and why they’re important when there are so many other, more immediate things competing for their money.
After all, there’s a lot of things competing for an employee’s money – whether it’s a new phone, a house or car, or adequate benefits coverage – and most people would rather buy a shiny new anything than kick a little extra toward their retirement.
Employers seem to be aware of this, hence the call for advisors to help.
“Ultimately,” said Tom Foster, spokesperson and practice management leader for MassMutual’s retirement plan services, “the benefits an employer selects should meet the diverse needs of employees as dictated by family situations, generational and gender differences, and personal finances, among other circumstances.”
But employers aren’t necessarily benefits experts, which is why they place so much value on solid professional advice.
VOLUNTARY BENEFITS AND YOU
Because of this holistic shift, it may be beneficial for you as an advisor to be aware of how voluntary benefits fit into the bigger picture. And there’s an opportunity to gain clients, because the study shows that nearly 40 percent of employers without an advisor want benefits guidance. Adding voluntary benefits to your lineup represents a significant potential opportunity to expand your practice and increase your value to the clients you already serve.
Read the 2016 MassMutual Benefits Advice Study Summary to learn more.
More from MassMutual
12016 MassMutual Benefits Advice Study based on research conducted by Greenwald & Associates on behalf of MassMutual, including exploratory in-depth interviews with four retirement plan sponsors and four advisors as well as an online survey of retirement plan sponsor decision-makers. The survey was conducted from August 17 to September 8, 2015. Data is weighted by plan asset size to reflect the composition of U.S. employers with fewer than 25 employees to 1,000 or more employees. Of the 565 plan sponsors who participated in the survey, 449 currently work with a plan advisor and the other 116 do not.