Middle class America is expecting to push out full retirement even later due to financial worries. We’re also expecting to have to save more. Yet almost half of us haven’t worked out how long we can last on what we’ve got already.

According to Wells Fargo’s new survey:

• Almost half said that they expected to continue in the same job or a similar job of similar responsibility (expecting the same income level, we presume).
• More than half said they need to significantly cut back on spending now to save for retirement.
• More than 25% of 20-30-year-olds expect no income at all from Social Security during retirement.

Another new report, “The Financial Recovery for Retirees Continues“, released by The Society of Actuaries, LIMRA and the International Foundation for Retirement Education offers this finding:

• The number of people who have NOT yet estimated how long their assets will last in retirement INCREASED significantly (to 46% from 38% last year).

Let’s review these results.

• We know we have to work longer.
• We’re hoping to make the same pay in the same jobs well into retirement.

But,

• We haven’t worked out if we actually have enough to retire based on what we have now.
• We think we need to save more than we are managing now in order to retire comfortably.

No wonder so many of us are worried and preoccupied. Except, of course, for the ones who are just burying their heads in the sand!

Sounds like a lot of us could benefit from a Financial Assessment and some Next Steps guidance.

GuideSpark has created a new video course to assist HR departments making the exciting leap into video communication. In this course, our director of Content Development and Video expert extraordinaire, Joseph Larocque, explains that topics which are more complex or require careful explanation are natural places to start. Good candidates are core benefits, Open Enrollment changes and tough messages such as a premium increase.

“Video can really help people understand how these plans work, how they compare, and why they are compelling,” says Larocque. “If you are introducing one of these in the upcoming year, starting your video communications here will drive adoption.”

GuideSpark’s system tracks the usage of our customers’ video libraries in great detail and provides this information the the HR department in an easy-to-read dashboard. Based on our customer statistics, the Top 5 Most Viewed Employee Benefits Videos are:

• Consumer Directed Health Plan
• Medical Plan Options
• 401(k) Retirement Savings Plan
• Employee Stock Purchase Plan
• Roth vs. Traditional 401(k)

To learn more about how to create benefits communication videos, click here to watch the video course: Transform Benefits Education with Video.

Findings from the 2011 Aflac WorkForces Report highlighted the discrepancy between how companies and their workers view benefits communications:

• 85% of employers believe their HR departments are effective at benefits communication
• 27% of employees say their HR communications are not very/not at all effective
• 39% say the efforts are somewhat effective

And yet everyone agrees there is much needed improvement:

• 8% of employees say they are fully engaged in making benefits decisions
• 63% of companies say their workers need to be more engaged

What’s at stake? Not surprisingly, workers who are unprepared and under-protected against an accident or illness are highly vulnerable to the financial implications of an unexpected health event.

As more and more organizations realize, the health and financial wellness of an employee has a direct effect on the company’s productivity and retention levels.

• Companies are paying three times as much as last year in health premiums
• Most employers think their benefits communication is effective but few employees feel well informed
• Under-educated employees are making expensive decisions

Surely there are more options for proactive organizations than just waiting for the US Congress to work together to uncover ways to reduce both the country’s budget deficit and soaring health care costs. At the recent 24th Annual Benefits Forum and Expo in Dallas, two industry experts highlighted some key ways to reverse these trends.

Repeat after me: Improve Benefits Communication
Benefits Communication expert, Jennifer Benz, spoke about the need to simplify benefits for employees. According to her, benefits managers have an opportunity to solve one of the country’s biggest problems just by improving benefits communication.

Put benefits information online, outside the firewall. Establish a year-round dialog with employees through social media. Use public health services and other existing resources to promote benefits.

Balance Health and Financial Wellness
Ron Leopold, Vice President and National Medical Director of MetLife U.S. Business and industry thought leader, advises organizations to focus on helping employees find physical and fiscal success.

“There is a yin-yang relationship between health and financial,” Leopold said. “People who are financially secure are in a better position to maintain better health and people who are not financially secure face greater obstacles in terms of getting healthy and getting health care coverage.”

So there you have it. Improve benefits communications and invest in all-around wellness. Problem solved! If only getting Congress to work together was so easy…

Drive 401(k) participation by tying to Open Enrollment

contribution changes to 401(k) plans during open enrollment, employers have seen an increase in participation.   The study showed an 11% year-over-year increase in the number of employees making a change to their retirement plan election as a result of the association with the health care open enrollment period.  And nearly all of these election changes were positive (93%), meaning employees started or increased contributions to a plan.

While Health & Welfare benefits enjoy an annual period for employees to reflect on their needs and make adjustments, retirement plans have not historically enjoyed this kind of attention.  And studies show that it’s sorely needed.  This Open Enrollment period, consider offering some communications dedicated to your 401(k) plan and provide easy access to make changes.  You may be surprised at how many employees engage.

Start with a Financial Health Assessment

initiatives are:   (1) becoming much more comprehensive and (2) demonstrating tangible business value.

In our own experiences with HR professionals, we see the expansion every day.  Wellness strategies are evolving and many employers are looking to better understand how employee money issues are impacting the productivity of their organization.

Sound overwhelming?  Well, it doesn’t have to be.

If you’re looking for a simple and cost-effective way to get your arms around financial wellness, we recommend starting with a financial health assessment. Think of it as a biometric screening of an employee’s financial health. Once you understand which issues are impacting employee productivity the most, you can confidently introduce programs that address the highest priority problems.  And, with an annual assessment, you can measure the progress you’ve made and demonstrate value.

Here are some important qualities that you’ll want to look for in an employee financial health assessment:

1. Be sure it addresses the complete financial picture. In addition to retirement, you’ll want to dig into credit/debt, personal protection and basic cash flow and budgeting issues.  Just as important is measuring the level of financial stress that employees are under which can have damaging impacts on productivity.  The Personal Finance Employee Education Foundation offers a Personal Financial Wellness Scale (free of charge) well suited to measuring financial stress.
2. Be clear about your intentions.  When it comes to something as personal as money, many employees may be reluctant to share information with their employer.  We recommend that employers only view the data in aggregate and be clear in communications with employees about what the data is being used for.
3. Keep it short and offer an incentive.  In addition to effective communications, keeping the assessment to 10 minutes in length and offering an incentive will really help drive participation rates.  Many of our customers have seen success with gift cards, deposits into a 401(k) or HSA and of course cash works too.
4. Reporting should be actionable – for employee and employer.  Upon completion of the assessment, an employee should receive immediate and easy to understand feedback about how to improve their personal situation.  For employers, it’s important to recognize that at the end of the assessment all you’ve got is data.  The hard part is in interpreting it.  Be sure that you have a capable team working with you that can benchmark the results, prioritize issues and provide you with actionable conclusions.
5. On-ramp to a full solution.  So, 37% of your employees are struggling with debt issues.  Now what?  You may want to choose an assessment provider that can offer an easy transition to education and services.

Employees seek retirement advice from their employers

A majority of people have agreed they would like more guidance from their employer about how to achieve retirement goals according to the 11^th Annual Transamerica Retirement Survey.

Perhaps not surprisingly, employees with a higher overall education level are more likely to be financially well in retirement. Only 63% of employees with only a high school diploma participated in a retirement plan, as opposed to 84% of those with a college degree.

But all education levels showed a desire for direction from their employers.

More than half of all surveyed, agreed that they would like more information and advice from their employer about how to reach retirement goals. In fact, employees surveyed indicated that “educational materials that are easier to understand” is the second biggest motivator in getting an employee to learn more about saving and investing for retirement (behind tax breaks/incentives).

Investing in better retirement education for employees is a cost-effective way to motivate employees to save for their retirement and ensure their financial wellness.

Benefits Communications Turn Risk Into Opportunity

As the economy improves, the tide may be turning once again according to several new studies.   Here are some key findings:

• Up to 60% of top performing employees plan to leave their organization within the next year
• In October 2010, the number of employees voluntarily quitting their jobs surpassed involuntary terminations
• Employees will be giving more serious consideration to new job opportunities than they would have in the past
• Employee engagement is at a historical low – some employees spend up to 50% of their time looking for another job

Think: risk and opportunity.

It’s time once again to use benefits as a strategic tool to keep your best employees and get new stars in the door. And don’t forget, your success is as much about how your benefits are communicated as the benefits themselves.

Employees Remain Cautious

according to the Q4:2010 Principal Financial Well-Being Index survey.  Here are some of the key takeaways:

• Half of employees did not feel better about their financial situation than they did a year ago. Nearly 40% of employees were still cautious about the economy.
• 72% of employees are concerned about their long-term financial future.
• Health care costs (65%) and economic uncertainty (59%) topped their short-term concerns.
• Living within their means (62%) and having an emergency fund (46%) were employees’ main priorities as they re-build their financial well-being.

While this data can be helpful as a benchmark, it’s always best to assess your own employees to understand their specific concerns and issues when it comes to money.   From this assessment, you can build the most effective financial wellness programs and have the greatest impact on the well being of your population.

40-52% of workers are delaying their retirement.

70 is the “new 65,” according to Sun Life Financial. Their Unretirement Index, along with Towers Watson’s 2010 Global Workforce Study, show that 40-52% of Americans will delay their retirement due to ill financial health.

Towers Watson found 68% of those workers will continue working in order to keep their health care coverage, while 61% cited their lacking 401(k) plans as the reason for staying. Sun Life found that only 25% are “very confident” they will be able to cover medical expenses in retirement.

Americans are also changing their current lifestyles to meet their financial needs and cope with financial fears by reducing spending and debt, and increasing saving and investing. About 18% are even putting off routine medical procedures to save money.