2014 WWCMA Presentations

1. -Presented by-
Mark Singer CFP®, AIF®
Best Selling Author & Founder of The Financial Literacy Toolbox
Greater Boston Corporate Wellness Forum
152 The Lynnway, Lynn, MA 01902
781-599-5009
WWCMA 2014 Conference Delivering the Financial Wellness your Employees Need

2. Audience Survey Question
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4. “Companies put ‘the cart before the horse’ in emphasizing employee investment education. What employees first need to do is to straighten out their personal financial mess.”
– Mark Nadler, Economist, Professor at Ashland University
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5. Financial Wellness Gap A Lengthy Journey
ENROLLMENT
RETIREMENT
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6. Why it is financially smart
TO BE PROACTIVE…
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7. INCREASE THE BOTTOM LINE by Helping Distressed Employees During Challenging Financial Times
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8. Employee Personal Finances And The Bottom-line
Financially Illiterate adults do not manage their personal finances very well…
 And they do not save and invest enough for a financially successful retirement.
This contributes to lower productivity as well as higher health care costs.
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9. 9%
39%
33%
16%
3%
Extremely
knowledgeable
Fairly knowledgeable Somewhat
knowledgeable
Slightly
knowledgeable
Not at all
knowledgeable
Are Your Employees Preparing?
“People who fail to plan for retirement have half the
wealth of people who do”
Dr. Olivia S. Mitchell – Pension Research Council
The Participant Magazine (2012). Annual SSGA 2012 Participant Survey Retrieved from
http://www.ssga.com/definedcontribution/us/docs/KnowledgePower%20SSgADC_The%20Participant02.
pdf
Employee Knowledge about Financial Matters
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10. Let’s Talk About…
Employee Personal Finances
Employer Bottom Line
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11. Employee Personal Finances Retirement Saving Realities
Participation in and deferral rates to retirement savings plans are inadequate
Most are not saving enough for retirement
Workplace education and advice programs have been underutilized
Millions of employees say they cannot afford to save for retirement, and 1 in 4 say credit card debt is a reason
Employees do not know how to help themselves
Employers do not understand the value of providing their employees easy access to the best mix of quality financial programs
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12. AND The Lack Of Financial Literacy Is THE MAJOR REASON Why Employees Do Not Save For Retirement
“Financial Literacy” Is Knowledge About
Spending Plans
Credit Management
Savings
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13. 30 MILLION AMERICAN WORKERS – 1 in 4 – report they are seriously financially distressed and dissatisfied with their personal finances.
“These distractions and resulting levels of stress affect EEs health & productivity and perpetuate a myopic view of the future”
Financially Stressed Employees = Unhealthy & Unproductive Employees
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Price Waterhouse Company (2014.) Annual Price Waterhouse Financial Wellness Survey Retried from: http://www.pwc.com/en_US/us/private- company-services/publications/assets/pwc-employee-financial-wellness- survey-2014-results.pdf

14. EE Financial Stress Rising
61% Dealing with Financial Stress
Of those, 56% Cite Stress Level INCREASED Over Prior Year’s 28%
Price Waterhouse Company (2014.) Annual Price Waterhouse Financial Wellness Survey Retried from: http://www.pwc.com/en_US/us/private- company-services/publications/assets/pwc-employee-financial-wellness- survey-2014-results.pdf
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15. Audience Survey Question
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17. High Stress Impacts Workplace 1/3 EEes Cite Financial Issues A Distraction At Work
Price Waterhouse Company (2014.) Annual Price Waterhouse Financial Wellness Survey Retried from: http://www.pwc.com/en_US/us/private- company-services/publications/assets/pwc-employee-financial-wellness- survey-2014-results.pdf
EQUALS 12-20 hours per month LOST IN WORKPLACE
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18. Stress Heightens for Majority of Employees
In 2011 the highest financially stressed employee segment $100K+
In 2012: $30K - $49K
40% stressed in this segment in 2012
28% in 2011
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19. Research says, “Every time someone on your work team brings his/her money worries to the team, WORKPLACE PRODUCTIVITY DROPS”
Cultural Impact
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20. Annual Cost to Employers For Ignoring One Worker’s Financial Illiteracy©
Lost productivity for each financially unwell employee
$450
(a)
Higher health care cost for poorer health
$300
Subtotal
$750
Lost employer FICA savings on worker who does not join health care reimbursement (FICA)
$92 (cash)
(c)
Lost employer FICA savings on
dependent care reimbursement (FICA)
$382 (cash)
(d)
Worker stays in expensive health plan
$800
(e)
Total Opportunity Cost
$2000
+
“Employer cost for not providing basic financial education that changes behaviors and job outcomes is $750 to $2,000+ per employee!”
© Personal Finance Employee Education Foundation. Garman, T. (2008) Increase the Bottom Line by Helping Distressed Employees During Challenging Financial Times (PowerPoint Slides) Retrieved from: https://www.shrm.org/multimedia/webcasts/Documents/garman.pdf
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21. “Employers may not realize they can improve profits
–AND PROVE IT–
by helping employees improve personal financial behaviors”
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22. Studies have shown that RETURN ON INVESTMENT for financial wellness training in the workplace is $2.8/1 AND MAY BE MUCH GREATER*
* These calculations are reasonable estimates. Some numbers are very low estimates and ABC Company’s Human Resources Department has the most accurate data. Decreases in accidents, workplace violence and theft , and reduced fiduciary liability are additional ROI values that are not part of this ROI calculation, although they could be and would increase the ROI significantly
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23. Integrate Wellness with Retirement Plan
Use New Technologies to Deliver and Measure Results
Develop Benchmarks For Future Success
The Tools To Use To Change The Conversation…
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24. Participant Behavior
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56% Of Employees Prefer On- Line Education

25. Financial Literacy Topics
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26. Comprehensive Data Usage Activity Reports
Company & Individual Level
Date
Personalized engagement score
% of video watched
Viewed downloads & attachments
Name & email address
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27. Audience Survey Question
Basics of Investing
Financial Planning Basics
Mechanics of Budgeting
Psychology of Budgeting
Basics of Asset Allocation
Basics of College Planning
Coordinating Your Dream Team
Protecting Your Family (insurance/estate planning)
Setting Goals
How To Maximize Your Social Security Benefits
Nearing Retirement: What to Do
The Most Common Retirement Mistakes
Why It Is Important to Create a Bucket List
Coping With Death
How Women Can Take Control of their Financial Planning
Intergenerational Conversations: How to Have Them
The Importance of Financial Organization
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29. Employee’s Desire For Enhanced Financial Information
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30. Conclusion
Financial Stress = Unhealthy, unproductive workforce
Latest Stats illustrate impact of and rise in stress
Illustrations demonstrate the benefits of a solid wellness program
Happier, more productive employees
Health savings costs
Better prepared for retirement
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31. Go to Financial Literacy Toolbox
www.financialliteracytoolbox.com
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32. Footnotes
a.Based on reduced absenteeism and less work time dealing with personal financial concerns. See research and press releases at www.PersonalFinanceFoundation.org
b.Conservative estimate as poor financial wellness and high health care costs are correlated; confirming research underway
c.Employer saves $92 in FICA taxes that need not be paid the government because employee contributes $1,200 to health reimbursement plan ($1,200 X 0.0765)
d.Employer saves $382 in FICA taxes that need not be paid the government because employee contributes $5,000 to dependent care reimbursement plan ($5,000 X 0.0765)
e.Employer saves $800 for every employee who moves from traditional BCBS health care plan (for which employer pays $6,000) to consumer driven health care (CDHC) policy which is less expensive for the employer ($5,200)
f.Bagwell & Kim, 2008; Drentea, 2000; Drentea & Lavrakas, 2000; Garman et al, 2004; Genco et al., 1999; Garman et al., 2007;l Jacobson et al., 1996; Lyons & Yilmazer, 2005; Kim, Sorhaindo, & Garman, 2004; Prawitz et al., 2007; Shatwell et al, 2007.
g.Kim, Sorhaindo, & Garman, 2003; Prawitz et al, 2007; O’Neill et al, 2005 (2 articles); Sorhaindo & Garman, 2002.
h.Garman et al, 1999; Kim, Garman, & Sorhaindo, 2003 (AFCPE and ACCI); Kim, Sorhaindo, & Garman,
i.2004; O’Neill et al, 2006; Weisman, 2002.
j.Kim, Garman, & Sorhaindo, 2003 (AFCPE and ACCI); O’Neill et al, 2006; O’Neill et al, 2005 (2 articles).
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