Employers Returning to Pre-Pandemic Benefit Goals

Many are refocusing on financial wellness programs and retirement income options.

Investment consulting firm NEPC recently found, in its second “Defined Contribution COVID Impact Poll,” that employers are returning their focus to benefits that were a priority before the COVID-19 pandemic came on the scene. Namely, they are once again focused on financial wellness programs and retirement income options.

“The pandemic and CARES [Coronavirus Aid, Relief and Economic Security] Act changed the landscape, and plan sponsors worked overtime for their participants last year,” says Ross Bremen, a partner at NEPC and a member of the firm’s defined contribution (DC) practice group. “There’s a more optimistic view of 2021, with the majority of respondents (40%) planning to get back to ‘business as usual.’ Topics that were hot prior to COVID—financial wellness tools (40%) and lifetime income (33%)—are back on the docket.”

The NEPC findings echo a recent Employee Benefit Research Institute (EBRI) survey that found about half of plan sponsors offer a financial wellness program tied to their retirement plan.

And a Nationwide survey found that nearly two-thirds of plan sponsors are considering offering a retirement income option as a result of the Setting Every Community Up for Retirement Enhancement (SECURE) Act.

Ninety-six percent of respondents in the NEPC poll said they are satisfied with their investment menus. Thirty-two percent rated their target-date funds (TDFs) as “terrific.” Not a single respondent said their TDF delivered “disappointing” performance.

The majority of the respondents are from public (19%), health care (20%) and corporate (52%) organizations.

While 50% of all respondents enacted furloughs last year, this jumps to 66% of health care organizations.

Forty-four percent of health care plans suspended their matches last year. All respondents that suspended the match in 2020 say they will reinstate it this year.