The future of financial wellness: New Voya whitepaper provides actionable insights to support increasing health and wealth needs of working Americans

WINDSOR, connection – (BUSINESS WIRE) – Voya Financial, Inc. (NYSE: VOYA), publishes a new white paper of its Voya Behavioral Finance Institute for Innovation: “Financial wellbeing meets behavioral economics: helping participants see the big picture and act on it. ”In the paper written by Shlomo Benartzi, Professor Emeritus at UCLA Anderson School of Management and senior academic advisor to the institute, Benartzi outlines opportunities and considerations for employers to help their employees use their savings to maximize health and wealth. In the 21st century, American workers must prioritize both health and wealth when making financial decisions. Hence, they need to effectively distribute their savings across different financial products and accounts. Given the complexity of these alternatives, making the right choice requires employees to see the big picture.

When it comes to saving for the future, many people seek support in their workplace, but the reality is that often saving is not enough. Nowadays, workers are also tasked with distributing their funds across various financial products and accounts, such as: B. Retirement accounts, emergency preparedness, health care, and even education. Alongside these competing financial priorities, nearly three-quarters (73%) of Americans feel their money is running out of money as they used to, 1 according to new data from Voya.

“The financial life of working Americans is getting more complicated and it is becoming clear that saving just for retirement is no longer enough when it comes to preparing for the future. Now, to effectively determine where to allocate their paychecks, individuals need to ask themselves several questions: Should they fund their 401 (k) account or their emergency savings account? Should you choose a high deductible health insurance plan and put your savings in a health savings account? Should they pay off their student debts or start saving on a 529 education account? And the list goes on, ”said Charlie Nelson, vice chairman and chief growth officer, Voya Financial. As a result, the workplace continues to grow in importance in helping Americans meet both their health and wealth needs. This represents a new and unique opportunity for employers to help employees maximize their long-term financial goals. ”

In the new whitepaper, Benartzi examines a behavioral tendency known as “narrow framing” – an inability to see the “big picture”. When it comes to allocating savings, tight framing can result in people investing in accounts that may not be as favorable to their own needs and long-term financial well-being. For example, failure to save for emergencies can lead to financial shocks and expensive debt that can lead them to seek funds from their retirement assets.

“Since many individuals are prone to tight-knit financial decisions, it is important to give workers clear instructions on how to divide their dollars into different types of finance, from savings accounts to health insurance plans,” added Benartzi. “Financial well-being is like physical well-being. If you really want to be healthy, you need to develop a holistic plan that includes diet, exercise, and sleep. Financial wellbeing requires the same holistic commitment. In order to think holistically about your own finances, however, you often need help. Here employers have a unique opportunity to support their workforce. ”

Using behavioral economics tools and insights, Benartzi suggests employers can take three primary actions to improve the overall financial health of their workforce. Specifically, he suggests employers to create a platform that:

  • Shows the big picture. When offering savings to employees, it is important to offer the opportunity to save for emergencies at the same time as retirement. Similarly, when offering health insurance options to employees, consider combining the cost of premiums and deductibles to get a better understanding of the potential total cost.

  • Makes it easy to respond to the big picture. Once the individual is able to see the big picture, it is equally important to be able to act on it. For example, when saving in an emergency, consider the same autopilot tools that help workers save for retirement, including an escalator feature. In the case of health insurances with a high deductible, this could mean that individuals can redirect their savings from the lower premiums to a health savings account or supplementary insurance.

  • Personalizes the big picture. No two people are alike when it comes to saving, which is why individual advice is becoming increasingly important. For example, the best health insurance option often depends on expected medical usage; while the optimal allocation of savings depends on how much you have saved and how high your retirement income is.

“As household finances become more complex, tight framing becomes an increasingly costly mental trend,” added Benartzi. “By minimizing the impact of narrow framing, we can really help our employees make better use of their scarce dollars. The goal is to make the optimal choice the easiest. ”

“When it comes to planning for the future, it’s important to us to make the right choice easy for everyone,” added Nelson. “Developing a data-driven financial wellness benefit that will help people make better use of their scarce dollars is the ultimate goal, and employers who really focus on the bigger picture of their participants will help achieve better results for all individuals . ”

We’re celebrating five years of behavioral science in action

Since its launch in 2016, the studies and collective insights conducted by Voya’s Behavioral Finance Institute for Innovation have enhanced the digital experiences of more than 99% of Voya’s retirement plans and nearly 5,500,000 eligible retirees participants with their retirement plans – and more than 375,000 individuals taking action.3 Improvements in participants’ savings rates also ranged from significant increases of 8% to, in some cases, significant doubling of their own savings rate.4 By merging the behavioral sciences with speed and size In the digital world, the institute continues to develop large-scale solutions designed to help improve individual retirement outcomes. For more information and the results of the current whitepaper or previous studies, please visit Voya.com/behavioralfinance.

As an industry leader focused on delivering health, wealth and investment solutions for and through the workplace, Voya Financial is committed to fulfilling its mission to create a secure financial future for all Americans – one person, one family, one institution at a time.

1. Voya Financial survey conducted on the Ipsos eNation omnibus online platform August 27-30, 2021 of 1,003 adults, surveyed by 475 American working people and 291 US beneficiaries aged 18 and over

2. Includes Voya Enroll, Pweb Screen Changes, and Personalized Video Distribution.

3. Taking measures that are defined as influencing a behavior-modified digital intervention that increases participation or the savings rate (e.g. smarter standard settings, planned savings, tariff escalation, e-mail campaigns to save and restarting Spar-E -Mail campaigns and personalized videos). This includes those who accept non-zero default values.

4. Depending on where in the digital experience actions were taken by a participant. Based on Beshears, Mason, and Benartzi. “How to Choose a Standard” (Coming in 2021); Bhargava, Conell-Price, Mason, and Benartzi. “Save (d) by Design” (working paper 2018).

About Voya Financial®

Voya Financial, Inc. (NYSE: VOYA) provides health, wealth, and investment solutions that enable its approximately 14.8 million residential, workplace, and institutional customers to achieve their financial wellness goals with confidence. With the vision of being America’s Retirement Company®, Voya’s products, solutions and digital capabilities help create a better financial future for all. Voya is a Fortune 500 company with 2020 sales of $ 7.6 billion and total assets under management and management of $ 721 billion as of June 30, 2021. Certified a Great Place to Work by the Great Place to Work® Institute, Voya is equally committed to socially, ecologically, economically and ethically responsible business activity. Voya Named One of the World’s Most Ethical Companies® by the Ethisphere Institute; # 1 Financial Services Company in Barron’s 100 Most Sustainable Companies for three consecutive years; as a member of the Bloomberg Gender-Equality Index; and as “Best Place to Work for Disability Inclusion” on the Disability Equality Index. Please visit voya.com for more information. Follow Voya Financial on Facebook, LinkedIn and Twitter @Voya.

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