Retirement site help resources can support financial literacy across demographics

In addition to more obvious hurdles to retirement saving—like student debt, inflation and income disparity—plan sponsors must also pay attention to participants’ financial literacy. From the internet-savvy college graduates who may lack financial know-how, to older Americans with a confident grasp of their savings plan but a tremulous grip on mobile and desktop navigation, participants approach retirement saving from a diverse background and skill set. In many cases, low financial literacy can lead to disengagement among participants, negatively decision making and ultimately derail retirement savings goals.

Low levels of financial literacy have been linked to financial stress and difficulty saving. According to a report published by TIAA, individuals with low financial literacy are:

  • four times more likely to struggle to make ends meet
  • three times more likely to struggle with debt
  • four times more likely to lack sufficient emergency savings
  • four times more likely to stop saving for retirement in response to inflation

This last part—the interruption in retirement saving—is often the most worrisome. As the head of the TIAA Institute Surya Kolluri elaborated, “40% of American don’t have enough saved for retirement…[this] means families will have to work even harder to achieve a secure retirement.”

Preparing participants for retirement is not just a matter of introducing new features but ensuring that participants know how to use these features—and how to find help if they don’t. Help resources on retirement sites are one way to ensure all users can find the help they need.

Help resources on retirement sites improve financial literacy

Financial literacy can be bolstered not only through educational materials, but also by leveraging key help resources—like tooltips, contextual information and clear navigation—to enhance decision support, highlight notable services and guide users through the participant site.

Corporate Insight’s recent Help Resources report found that it is imperative for firms to strike a delicate balance between breaking down complex information without overwhelming participants. Jargon, regulatory language and dense explanations often do more harm than good. Plan sponsors need to ensure that participants feel engaged and motivated to actively save for retirement. As Lisa Garcia, a retirement plan consultant with Sageview Advisory, remarked at the 2023 PlanSponsor National Conference, “to boost employee engagement, I think we need to boost their financial confidence and help them feel empowered.” Help resources need to be informative and approachable, and highly rated firms in the report accomplish both.

Corebridge Financial’s contribution transactional interface is a good example of how help resources can sometimes be decidedly unhelpful. The transaction interface features a series of lightboxes where participants can view additional details about various contribution types. For a financial novice, this kind of support can be invaluable for managing their contributions. However, the lightbox explanations are dominated by jargon, industry terms and legal statutes. Retirement savers with limited financial literacy, language like this can risk further alienating participants.

A jargon filled lightbox from Corebridge
Corebridge Financial Alert Lightbox

Conversely, Fidelity’s lightbox—findable within their contribution management interface—presents essential information in easily digestible text. Notably, each explanation goes a step beyond a mere definition and explains how each concept or item may directly apply to the participant. The use of lightbox also allows participants to review these terms while simultaneously engaging with the transactional interface.

A lightbox from Fidelity's netbenefits site
Fidelity Contribution Management Lightbox

Help resources can direct participants to advisors

Help resources also do well when they encourage savers to consult a professional when appropriate. A recent study by Charles Schwab gauged that among 401(k) participants, only 27% considered themselves “very confident in investment decisions on [their] own.” Conversely, 49% reported feeling “very confident” when using the help of a professional. These results show a demonstrated need among participants for additional support and guidance, especially when it comes to managing their investments. Adequate help resources can provide an essential middle ground between professional consultation and investing independently.

But some plan participants require more help to feel confident in their financial plans. Research by the Employee Benefit Research Institute (EBRI) found that not only is participants’ financial knowledge low, but that a larger number of employees (40%) rely on family and friends for advice as opposed to their plan provider. By leveraging key help resources, plan sponsors can encourage participants to rely on their advisors for crucial information instead.

Tooltips can provide immediate support

Tooltips are an excellent method to provide immediate support as participants navigate through the site. Principal sets a good example by not only using multiple tooltips, but for ensuring design elements are consistent across the site to signify help resources. The lowercase letter “i” encased in a blue circle is the firm’s standard indicator of a clickable tooltip. These resources can be found both in the dashboard and transactional interfaces, offering front-line support with friendly, jargon-free text explanations.

This screenshot shows Principal's homepage retirement score tooltip
Principal Homepage Retirement Wellness Score Tooltip

An in-depth exploration of how firms across the industry are leveraging help resources to improve participant engagement can be found in CI’s Participant Site Help Resources report. From expanding Education Hubs, to modernized help centers and exciting site features—like guided tours and AI chat support—firms can continue to boost participant support by making their sites user-friendly for retirement savers of all knowledge levels.

Madeleine Virginia Gannon

Madeleine Virginia Gannon is an analyst on CI's retirement and workplace finance team.