The Impact of Virtual Financial Wellness on Retirement Readiness

Workplace financial wellness benefits take many forms, from one-on-one sessions with a financial professional to virtual tools that employees use on their own schedule.

This review looks at the virtual side of that range, and at a practical question for recordkeepers and asset managers (and their advisor partners) considering offering virtual financial wellness for all participants as a baseline component of their solutions: does engagement with a virtual financial wellness benefit move the retirement numbers the industry already tracks? The answer carries particular weight where a solution does not include human coaching, because it speaks to whether a digital-first program can deliver retirement value on its own.

The findings that follow draw on Financial Finesse’s Financial Wellness Think Tank data across employer clients, set alongside third-party research where it adds context. The Think Tank figures compare employees who engaged with the virtual benefit against those who did not, and they follow return users over time, so they are presented as observed associations. A note on interpretation appears at the end.

Contribution behavior is the most direct measure of retirement saving, and engagement with a virtual benefit tracks with higher contribution rates across two distinct employer settings.

At a large financial services employer, employees who used the virtual program started out contributing below the company average. Their average deferral rate was 6.4 percent, against a company average of 7.0 percent. After two or more years of engagement, that group’s average rate rose to 7.3 percent, moving from below the company average to above it.¹ A change of this size compounds over a full career. Industry modeling projects that maintaining a one percentage point increase in contributions over a 40-year career could add approximately $84,000 in retirement savings, enough to cover about nine years of average Medicare-related expenses.²

A large food and beverage employer shows a similar gap between users and non-users measured at a single point in time. Employees who used the financial wellness program contributed an average of 9.3 percent, against 7.9 percent among those who did not.¹

Engagement also tracks with whether employees are contributing to the plan. A 2025 study at a financial services employer found that employees who engaged with the virtual benefit in 2024 were more likely to be contributing to their 401(k) in 2025 than those who did not. Among those who engaged with the benefit, 8.4 percent opted out of the plan in 2025, against 10.9 percent of those who did not engage, a 31 percent lower opt-out rate.¹

Saving more matters less when the savings sit in a poorly constructed portfolio. Among return users whose investments were initially misaligned with their stated risk tolerance, after a year in the program 69.4 percent corrected that allocation and earned the “Retirement Investments Allocated According To Risk” milestone.¹ The shift indicates that engagement coincides with better-constructed portfolios, not higher contribution rates alone.

Loan activity is the retirement metric whose direction is read most often, and most easily misread. At the food and beverage employer, program users were less likely to carry a 401(k) loan than non-users, 19 percent against 29 percent, and their loans were smaller relative to their balances, 2.7 percent against 4.3 percent.¹

Reductions of this kind are common, but they are not guaranteed. A 401(k) loan can be drawn only against an existing balance, so as a program builds balances through higher contributions and fuller match capture, borrowing capacity grows with them. Across Vanguard-administered plans, about one in eight participants carries a loan at any time.³ A flat or rising loan rate can therefore sit alongside a healthy program. The lever that lowers borrowing is liquid emergency savings held outside the retirement account. Vanguard found that participants with at least $2,000 set aside were 19 percentage points less likely to take a 401(k) loan.⁴

A program can also help employees build that cushion in the first place. Among return users who reported that they did not initially have at least one month of living expenses set aside, 65.1 percent earned the “Emergency Savings Equals 1+ Month’s Living Expenses” milestone after a year in the program.¹ This milestone uses a larger benchmark than the $2,000 threshold in the Vanguard research, yet it measures the same kind of liquid buffer that keeps employees from drawing down their retirement savings.

The employees closest to retirement carry the highest stakes, for themselves and for the employer. Among return users age 55 and older who had not initially met a given retirement milestone, a year or more of engagement with the virtual program resulted in substantial milestone attainment.¹

These milestones map onto the components of a confident retirement decision: knowing where the money will go, capturing the full match, holding a current estimate of readiness, and maintaining an allocation suited to a shorter horizon.

Improvements in retirement readiness translate into cost savings for employers. Applied through a Financial Finesse ROI model, readiness gains of this kind could produce approximately $1.95 million in annual savings for a 50,000-employee organization. The figure is an illustrative projection from the model, not a current-year result. This delayed-retirement figure is one component of the model’s total, representing less than 10 percent of the roughly $23 million in annual savings the same analysis estimates across all categories for an employer of this size.⁵