CHRO presentation

1. FINANCIAL
WELLNESS
The Untapped Lever
Aimee DeCamillo
Head of Retirement Plan Services, T. Rowe Price

2. 2
1Pensions & Investments, March 10, 2016.
2As of December 31, 2015.
3Clients with plans on our OMNI recordkeeping platform as of December 31, 2015.
T. Rowe Price: A Leader in the Retirement Industry
years of investment
management
experience
OVER
75 manager of DC
assets1
Third-
largest 69%of our total firm
assets are
retirement related2
58%of our retirement plan
clients have been with
us 10 years or more3
OVER
Nearly 2 million
retirement plan
participants across
more than 3,500
plans, totaling $145
billion in assets2

4. Priorities in the C-Suite Converge
Retain
Talent
Engage
Employees
Provide
Strong Benefits
and Compensation

5. 1U.S. Today, 2014.
2T. Rowe Price RPS June 30, 2015, full-service DC plans.
The Retirement Crisis in a Nutshell
52% Have less than $10,000
saved for retirement1
7.8% Average participant contribution
vs. recommended 15%2
24% Participants who borrow
against their 401(k)2

6. The Vicious Cycle
48% say they can’t afford
to save more1
70% live paycheck
to paycheck2
24% of paycheck goes to
consumer debt payments3
64% can’t cover a $1,000
emergency without borrowing4
1T. Rowe Price Retirement Saving and Spending Study 2015.
2CNNMoney, 2013.
3U.S. Census Bureau et al. 2014.
4MarketWatch 2015.

7. The Result: Lots and Lots of Stress
64%say finances are the largest
source of stress in their lives
Source: American Psychological Association 2015.

8. What’s The Cost?
Over $5.6 million per year
Absenteeism $3,600 $2,520,000
Productivity $7,000 $1,750,000
(20 hours/month)
Present-eeism $2,000 $500,000
(6 hours/month distracted)
Accidents $29,600 $667,000
(23 stress related/year)
Financial Stress-Related Issue Cost Per Incident Total Cost
Turnover $3,500 $210,000
(40% stress related)
Ethics $1,700 $18,500
(Theft, 4.2% of employees)
Source: Pension Consultants Inc. 2014.

9. What Is Financial Wellness?
The ability of individuals to manage
their daily finances while setting
short- and long-term saving goals
so that they can invest in a secure
financial future.
“
”

10. The Financial Wellness Spectrum
Advanced
 Trust and Estate
 Income Planning
Intermediate
 Long-term savings needs
 Investing
Foundational
 Debt management
 Budgeting
 Emergency preparedness

11. 11
#1 Reason for Providing Financial Wellness
85%of plan sponsors said they want
to provide some type of financial
wellness offering because…
Aon Hewitt 2016 “Hot Topics in Retirement” Study.

12. It’s the right thing to do.
Aon Hewitt 2016 “Hot Topics in Retirement” Study.

13. 13
Source: T. Rowe Price/Brightwork Partners, LLC, Plan Sponsor Pulse Survey, April 2016. Survey of 155 401(k) plan sponsor with assets of $100 million or conducted online, March 22–April 1, 2016.
Major Objectives of Financial Wellness Initiatives
Retaining skilled
employees
74%
Increasing employee
satisfaction
69%
Improving employee
productivity
67%
Competing effectively
for skilled employees
64%

14. 14
Do You Need Financial Wellness? Consider These Factors:
Culture and benefits philosophy
Business symptoms
of “unwellness”
Workforce profile
and demographics
Retirement
plan data

15. 15
Styles of Financial Wellness Providers
Product-Based
Services
Coaching and
Behavioral Programs
Tools Education
and Literacy

16. 16
Considerations for Selecting a Provider
Budget or Cost Business Model Communication
Frequency
Multimedia
Resources
Data Reporting
Capabilities
Integration With
Other Benefits

17. 17
Integrating Financial Wellness
In person DigitalPrint

18. 18
Financial Wellness Works: Improved Emotional Outlook
Source: SmartDollar, 2015.
9%
39%
6%
22%
10%
22%
63%
14%
12%
3%
Before
Current
SCARED
SCARED
CONFUSED
CONFUSED
INDIFFERENT CONFIDENT
SECURE
INDIFFERENT CONFIDENT SECURE

19. Financial Wellness Works: Fewer Distractions at Work
37%
18%
21%
11%
13%12% 13%
22%
24%
29%
Very Often
Distracted
Often
Distracted
Sometimes
Distracted
Rarely Never
At start of program Two to five years later
Source: SmartDollar, 2015.

20. Financial Wellness Works: Less Financial Stress
Source: SmartDollar, 2015.
20%
29%
34%
14%
3%
5%
12%
33%
39%
11%
Overwhelming
Stress
High Stress Some Stress Low Stress No Stress
At start of program Two to five years later

21. Financial Wellness Works: Increased Retirement Preparedness
of program participants are saving
15% of their salary for retirement
after two years in the program
Source: SmartDollar, 2015.
39%

22. Source: Garman, E.T. Personal Finances and Worker Productivity, Proceedings of the Personal Finance Employee Education Best Practices and Collaboration.
Financial Wellness Works for Employers
$200,000 investment in program
$624,250 total savings
Bottom line:
Over 300% return

23. It’s the right thing to do.

24. 24
Key Takeaways
The lack of financial wellness creates substantial issues and
costs for employees, companies, and our country as a whole.
Assess your company’s retirement plan data, employee
demographics, business symptoms, and benefit philosophy
Determine which financial wellness programs meet your company’s
unique employee needs and your company’s priorities
of companies are
considering adding
a financial wellness
program to their
benefits package1
90%
NEARLY
1Aon Hewitt 2016 “Hot Topics in Retirement” Study.

25. Thank You
2016-AX- 23050