Plan sponsors in health care
Building a Better Retirement:
Health care
Health care’s wellness mindset guides how employers think about retirement plans, according to TIAA’s survey of 500 defined contribution (DC) plan decision-makers, including 50 C-suite healthcare leaders.
Nothing is easy in health care.
The work is demanding and turnover is high. Socioeconomic pressures are mounting. Retaining and attracting talent is still a challenge with a workforce still burned out from the pandemic. Hospitals, medical schools and clinics all have a lot on their plates, yet ensuring their employees have a top-notch retirement plan is still a priority. In a blind survey of 500 retirement plan decision-makers across 17 industries, TIAA found healthcare employers remain committed to ensuring positive outcomes for their workers' future financial well-being.
Eighty percent of healthcare employers say it’s their responsibility to help employees save and invest. And they’re much more likely to use automated features to help employees take steps they might not otherwise take on their own: 71% auto-enroll employees into their plans compared to 54% of all plan sponsors surveyed. They’re slightly less likely to offer a match (64% vs. 78%), likely due to budget constraints and compensation realities. Even so, nearly two out of three healthcare employers offer a match.
We don’t see a lot of people weighing the match when they consider a competing offer. They’re far more concerned about the cash compensation up front.
— Healthcare employer
Wellness is in their DNA.
Financial wellness is a critical part of retaining talent—a big concern among healthcare employers. Programs focused on financial wellness educate employees and help them feel more confident in their ability to manage their money, make good decisions and plan for the future. This is especially critical at institutions employing people in a wide array of roles with dramatically different pay and compensation structures.
Perhaps that’s why 67% of healthcare employers also offer a financial wellness program (vs. 54% for all sponsors), recognizing that when employees feel more educated about money, they’re often more productive and more likely to stay. More specific help can drive better results.
Healthcare employers want their retirement plans to work harder.
Employers across industries largely agree that people need additional sources of guaranteed income in retirement beyond Social Security. To deliver a guaranteed income solution within plans, many healthcare employers are taking a closer look at annuities, which 87% see as increasingly important in DC plans. They’re likelier to already offer annuities (39% vs. 26% for all sponsors), but there’s significant opportunity for even broader adoption. Looking forward, healthcare employers wanting to add a guaranteed income option with seamless employee access can consider a target-date solution that bakes in an annuity.
Overall, healthcare employers are working hard to promote their employees’ financial well-being in their working years and beyond, and their retirement plans reflect that. Enhancing plans—by adding features such as financial advice and guaranteed income—can take that support to the next level, benefiting employees now and in the future.
Building a Better Retirement Survey.
TIAA’s inaugural survey of retirement plan sponsors.
TIAA’s Building a Better Retirement survey consulted 500 C-suite leaders in finance and human resources across 17 industries (including 50 healthcare leaders) to elicit their thoughts on how their current retirement plans are working, what they’d like to do next and what’s standing in their way.
These decision-makers responded to our online survey between June and August 2024. Some gave follow-up interviews through November 2024, facilitating an even better understanding of how they’re thinking and the trends they’re driving.
This blind survey was conducted with Greenwald Research. Respondents did not know TIAA developed and sponsored it.
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“Building a Better Retirement” was conducted by Greenwald Research on behalf of TIAA.
Annuity account options are available through contracts. These contracts are designed for retirement or other long-term goals, and offer a variety of income options, including lifetime income. Payments from the variable annuity accounts are not guaranteed and will rise or fall based on investment performance. Any guarantees are backed by the claims-paying ability of the issuing company.
This material is for informational or educational purposes only and is not fiduciary investment advice, a securities investment strategy or an insurance product recommendation. This material does not consider an individual’s own objectives or circumstances which should be the basis of any investment decision.