DelGallo.com Wealth Management Essentials - Financial Education and Employer Compliance
By LEONARD J. DEL GALLO JR., M.S., MPASsm, CFP®
Financial Education is one aspect of the ERISA (DOL) 404 (c) requirements that is often not fulfilled by many employers and can create financial, staffing, and legal issues for an employer from lack of compliance.
“Does your pension plan have a published schedule of participant information and education events? Is a document file maintained, containing copies of all communications with plan participants? At every meeting with plan participants, is a list of attendees recorded and filed?”(1)
Many employers are under the belief that providing a pension and health plan at the company is sufficient to attract and retain quality employees. Others are under the impression that their insurance agent and/or their broker is providing all the services required to be compliant with government regulations. In addition, many brokers and insurance agents are not Certified Financial Planning Professionals ® or qualified to provide financial education workshops or seminars. It is ultimately the employer’s responsibility to make sure that their company is compliant with state and federal laws and ensure there are no ERISA violations or conflicts of interest. Human resource departments and/or staff members may not be trained or licensed to provide financial education services and outsourcing is often an approach that works best!
Just providing benefits to employees may not be enough! Please have your human resource officer or company fiduciary representative contact Del Gallo Financial Services, LLC today.
“Financial stress is a common preoccupation for people this time of year, as many struggle to work out how to fund a perfect Christmas for their loved ones. Even the more affluent among us will have their own set of financial worries, such as how they will secure the finance required to up-size their family home in time for the next school year.”(2) Employers who offer no support to employees may find employees less productive or absent more often. Employees may be designated into groups by an employer to segment certain financial education services to offer if applicable.
“Research conducted by employee benefits provider Sodexo Benefits and Rewards Services earlier this year found that of 760 UK employees ranging from 18 to 64 year-olds, the age group worst affected by financial stress were those aged 18-34. Among this group, more than a third of employees claimed their productivity had been damaged due to money worries, and across the whole workforce 32% admitted calling in sick due to stress, with 36% stating that financial pressure was the main reason.”(2)
Many more employers are offering workplace financial education, covering all manner of topics including how a mortgage works and student loan management for younger staff, financial planning for middle-aged workers and retirement planning for older staff, to make sure their employees have a sense of financial well-being. (2) The education services may be in the form of seminars, online meetings, in-person meetings, phone access or other designs that may work best in some office settings. These financial education services need not be expensive and many companies provide discounts or cost sharing for education services outside of their company’s general compliance requirements.
Any questions please contact Del Gallo Financial Services, LLC by visiting our website at https://delgallo.com/. Del Gallo Financial Services, LLC can arrange an educational seminar or workshop for your organization’s members and/or employees. This research commentary is intended to educate families so they may gain an introduction to a difficult planning topic and is not intended for any other purpose. Articles created by Len Del Gallo Jr., may not be copied or used without written permission from Len Del Gallo Jr. Please note that some information may be protected by copyright laws. Del Gallo Financial Services, LLC and its’ representatives do not provide tax or legal advice. Please consult your tax advisor or attorney for guidance on such matters and before implementing any strategies and/or updates to your planning. Del Gallo Financial Services, LLC is a Registered Investment Advisor and Licensed Insurance Agency.
- SOFA – The Society for Financial Awareness. “2019. ERISA (DOL) 404 [c] Requirement.” http://www.sofausa.org/legal/erisa
Leonard J. Del Gallo Jr., Broker Associate in Connecticut & Florida
CT Managing Broker: Berkshire Hathaway HomeServices N.E. Properties
Office: 172 West Main Street
Avon, Ct. 06001
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