Understated isn’t a term generally associated with Alex Assaley, but he managed to pull it off when describing current market conditions.
“It’s been a really interesting year for investors and advisors,” Assaley, Managing Principal with AFS 401(k) Retirement Services, said from the floor of the Wealth@wor(k) conference in Las Vegas. “For the first time in probably 11 or 12 years, we’ve had a consistent market sell-off. As we speak here today, we’re down probably 20% to 23% in stocks and probably 14% or 15% with bonds, and I remind our team that this is what we’re here for.”
Financial wellness, financial advice, personalization, whatever phrase one chooses to use, coaching is at the center of everything a retirement-focused consultant does, something in which his firm is heavily invested.
“We have built and continued to refine our financial wellness platform, MoneyNav,” Assaley explained. “The results are really profound. We have, across all of our clients, 60%-plus engagement in terms of employees accessing and being active in that financial wellness ecosystem we’ve built. That includes attending group workshops, accessing the online personal financial dashboard through the app, and holding one-on-one coaching sessions with our team members.”
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Importantly, they now have the data behind it, something he called “phenomenal,” specifically around how the firm is helping to increase both long-term retirement savings as well as savings and investments in other areas. They include emergency savings, goal-based savings, and then paying down credit cards, personal loans, and student debt.
It sounded good, and we facetiously asked if he’s “cracked the financial wellness nut.”
“Well, it’s funny because I’m biased,” he responded, not missing a beat. “I would say yes, but there’s still a long way to go, and we’re not unique in this. There’s a cohort of advisors and practitioners in the industry that are doing incredible work helping everyday working Americans inside the retirement plan get access to meaningful, on-demand financial coaching, guidance, and advice.
“When you hear somebody say, ‘Oh well, financial wellness is a unicorn in our industry. Everybody loves the idea, but no one’s seen it,’ I think that’s a good talking point, but it’s just not true.’”
A critical shift
Not surprisingly, scale is the issue. It’s something he thinks the next financial wellness iteration is already in the process of solving, and not from technology alone, which he believes the industry over-emphasized at the human element’s expense.
“I think it’s a shift in how advisors in their firms serve their clients. I think more and more advisory firms would recognize the need. Anecdotally, you hear it here at the conference today. I’ve been talking, having conversations with my peers and colleagues who said, ‘Oh yeah, I rolled out virtual financial planning in the last year, and we’re doing it with our clients, or we’ve been doing one-on-one coaching, and we’re building a team. Five or six years ago, I think most of them were saying, ‘We’re going to hire a third party.’”
Where once an advisor was happy with 10% to 20% participant engagement, that metric will be more like 50% or 60% engagement across the industry.
“We have some clients with 90% engagement where they’ve built and championed a financial wellness/coaching program with incentives for their employees. That means a 300- or 500-person company has 90% of them meeting one-on-one with a member of our coaching team.”
It’s a trend he believes will continue, mainly due to an unlikely silver lining to what participants have recently experienced.
“A lot of the workforce has now had a magnifying view on what they think is important in life. People really value the work/life balance. With that in mind, I think more individuals, households, and families are open to assessing their financial life. They don’t need a picture of them riding a bike through these financial milestones for gamification. They need a way to easily engage in a very efficient user interface. They need accountability, and they need actual down-to-earth guidance.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
