On Tuesday, Willis Towers Watson released a survey that found six in 10 millennials are willing to sacrifice pay for more secure retirement benefits. (This compares to roughly four in 10 in 2009.)
“Employees of all generations, including millennials, are feeling vulnerable about their long-term security,” says Steve Nyce, senior economist at Willis Towers Watson. “Employees young and old actually have a strong desire for more retirement security and are willing to give up pay to get more guarantees or a larger retirement benefit. Interestingly, employees seem to be saying they have enough health coverage now and are reluctant to pay more.”
As far as healthcare is concerned, only one-third of millennials (32 percent) surveyed said they are willing to pay a higher amount for lower or more predictable health costs, a decline from 43 percent in 2009.
When asked how they would spend money if their employer provided them with an allowance to spend on a variety of benefits, millennials said they would allocate more than half to healthcare and retirement-plan benefits (27 percent each). Not surprisingly, nearly half of millennials (48 percent) ranked pay and bonuses over all other benefits if given a choice, a clear indication of the financial issues they face and the need for more financial flexibility today.
Slowly but surely, employers are beginning to accept the fact that employees, be they millennials, Gen X or baby boomers, are hungry for support as they strive to tuck more money away for the future.
So I guess it’s no surprise then that we’re beginning to see robo advisers such as Betterment gain some traction in the workplace.
At the 2016 Benefits Forum and Expo in Nashville, Tenn., this week, Betterment General Manager Cynthia Loh shared the value her organization is bringing to the business community. (Loh spoke during a general session on Wednesday.)
Many of you probably will recall Betterment’s announcement last fall of a new 401(k) platform that uses technology to offer personalized investment advice for all participants, along with administrative and fiduciary support for plan sponsors. (It began rolling out the platform earlier this year.)
Betterment CEO and Founder Jon Stein said at the time, “Current 401(k) offerings—and we have examined them all—have poor user experiences, high costs and a clear lack of advice. Not anymore.”
In late July, the company announced that it had signed on more than 200 plan sponsors since the beginning of the year—and, according to Loh, the company is continuing to sign up new clients at a fast clip.
So far, Betterment hasn’t signed up any Fortune 1000-size organizations. The largest plan sponsor to sign on is MVP Anesthesia Associates, a physician group. But down the road, the company certainly hopes to make inroads into even larger employers.