When it comes to financial wellness offerings, record keepers are no longer just pitching managed accounts and one-on-one participant advice services.
Record keepers these days are branching out into new areas of financial wellness, offering everything from online legal services to emergency savings programs and even charitable-giving platforms — all in a bid to strengthen relationships with their plan sponsors clients, industry observers say.
"Until a year or two ago, everyone was talking about retirement readiness, and now it's changed to just the overall financial health of an individual," said Robyn Credico, Willis Towers Watson PLC's Las Vegas-based defined contribution consulting leader.
Some record keepers are offering the services themselves, while others are teaming up with outside providers. Some charge for the new offerings, others give them to the plan sponsor for free, Ms. Credico said.
Many of the services cover entirely new areas, such as online legal providers that assist participants with matters such as wills or provide them with information on different types of insurance, including life and even pet insurance. For participants with "furry children," information about pet insurance can "definitely" help plan sponsors gain greater loyalty from their employees, said Jana Steele, a senior vice president and defined contribution consultant in Callan LLC's Chicago consulting office.
"When employees feel the employer cares about them, they're more likely to be highly engaged and have a stronger relationship," she said.
Other new emerging services, such as emergency savings, have been around for decades and are now getting a makeover. An emergency savings account or "rainy day fund" in a 401(k) plan is just an after-tax account, which has been around for a long time, Ms. Credico said. "What record keepers are doing is helping with repackaging and rebranding that as an emergency savings account," she said.