New research from Fidelity highlights the increasing pressures many employers face as they work to guide employees toward a secure retirement. The study reveals a widening confidence gap, with only two-thirds of employers now believing their workforce is on track for retirement — reflecting a steep drop from just a year ago.
Financial stress among employees can reduce productivity and morale, increase turnover, and raise health care costs across the organization. For plan sponsors, this decline underscores the importance of regularly reassessing plan features, communication strategies, and support structures to help keep employees on course. It’s also a pivotal opportunity for sponsors to partner with plan advisors, who can help offer expertise and solutions to address these challenges.
A Growing Menu of Choices
New plan features and savings vehicles are expanding the menu of options available to participants, giving them more flexibility as well as the potential for lower fees and greater tax advantages. According to the Fidelity survey, more than half of plan sponsors are adding retirement income products, nearly half are adopting managed accounts, and more than four in ten are incorporating collective investment trusts (CITs). Meanwhile, target-date funds continue to evolve with risk-adjusted glidepaths, pooled employer plans are gaining traction, and health savings accounts are playing a growing role in long-term savings strategies.
Each of these options brings its own set of considerations for employers — from compliance requirements to participant communication. Working closely with their advisors, sponsors can better evaluate options for their workforce, assess costs, and help ensure compliance.
Wellness Takes Center Stage
There’s also a growing demand for participant education and financial wellness programming. The survey found that, among the 93% of sponsors who’ve incorporated a wellness program, 60% did so within the past year as financial wellness has moved from “nice-to-have” to “must-have” in benefit design.
For companies that haven’t yet implemented such programs, this rapid adoption may add to the sense of pressure to keep pace with peers and evolving expectations. Guidance from an advisor can help cut through the noise and build programs that align with workforce needs, attract and retain top talent, and achieve other long-term organizational goals.
Partners in Progress
Retirement plan advisors are well-positioned to help sponsors and participants address many of these pressing issues. According to a recent survey by Morgan Stanley, employees rank access to a financial advisor as the most desired option for retirement planning support.
For organizations, whether it’s streamlining investment decision-making, implementing financial wellness programs, adding managed accounts or CITs, exploring new plan design features, or strengthening fiduciary governance practices, a strong sponsor-client partnership can provide clarity and confidence. By working together, sponsors and advisors can meet the moment and help drive better plan outcomes.
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