Throughout many recent starts and stops in its wealth management ambitions, Goldman Sachs has kept its hand in the business of helping workers save and plan for retirement.
The Wall Street behemoth again signaled its interest in that work with its appointment of firm lifer Greg Wilson to lead the retirement unit within its Asset & Wealth Management division. Wilson, who started his career at Goldman in 1995, was most recently head of Workplace Advisor Solutions at Goldman Sachs Ayco, an affiliated workforce advisory firm acquired by Goldman in 2003.
In his new position, Wilson will continue working with Ayco while also helping to provide more services related to defined-contribution retirement plans like 401(k)s and Individual Retirement Accounts. Wilson said Goldman Sachs Ayco now works with more than 500 companies on their retirement and benefits offerings.
The firm, he said, is betting on its ability to call on its financial expertise to help its clients provide individually tailored plans to their employees. That will be coupled by its technological resources, which were bolstered
"You've seen this transition from pensions to 401(k)s. It's been a tectonic shift in the structure of retirement for America," Wilson said. "The dispersion of retirement savings illustrates how people struggle to save enough and make the right investment decisions. There's greater responsibility to do it on your own. And so we do think the next phase of evolution is around personalized advice and investing."
Goldman is placing new emphasis on retirement advising even as it has been backing away from offering wealth management and other services at the retail level. In August,
Wilson said he has no doubt that there remains a huge need for Goldman's retirement planning services. From a survey of 5,261 workers and retirees in July last year,
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"And each subsegment and each individual has different needs," Wilson said. "You know, today over 75% of millennials and Gen Z-ers are struggling with paying down student loans, as an example, versus 36% for boomers. And 40% of baby boomers struggle with credit card debt. That goes up to over 70% for millennials."
Wilson sat down with Financial Planning to discuss his new role at Goldman Sachs and how the firm can help workers still struggling with retirement planning. This article has been edited for clarity and brevity.
Financial Planning: What's the impetus behind this new retirement unit in Goldman's Asset & Wealth Management division?
Wilson: The thought was: If I can take our leading-edge expertise from an asset management perspective, marry that with industry-leading technology that we acquired through Next Capital — which gives us the ability to provide personalized advice and guidance within a 401(k) plan at scale — and then marry that with a comprehensive, holistic financial wellness offering from the tools and resources that we've built within Goldman. Harmonizing and bringing that all together can really help us define and provide solutions that ultimately will benefit the employees that we have the good fortune of serving.
FP: If I'm an employee of one of your client companies who wants a personalized plan, can I talk to a financial advisor of some sort? Or is most of the planning done through automated means?
Wilson: We're marrying both. We do believe that we have leading-edge technology that can provide you with the tools and resources to analyze your personal financial situation, take a financial wellness assessment and incorporate these things into asset allocation and help decision making within your 401(k) that looks beyond just your age. That may be age, gender or life circumstances, outside assets. So your spouse or partner, do they have additional assets? Do you have access to a pension plan? We incorporate all that to tailor a personalized investment solution that meets the needs for you and your family, however it's constructed.
There is also the ability to actually pick up the phone and speak to a financial coach to make sure that you're incorporating everything thoughtfully. That if you have some outstanding questions relative to that financial wellness assessment, you can speak to a human being.
We find that individuals often benefit from not only using the technology solutions, but also being able to access the human. And we've got financial coaches who have full access to all the systems to give you sound advice and guidance so that you can make the most effective decisions for your own individual circumstances.
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FP: Does the workforce advice you provide mainly around 401(k) plans, or does it extend beyond that?
Wilson: If you think about retirement, it is critically important that people are saving and increasing their savings. But you have to take into account their overall well-being. Are they saddled with a lot of credit card debt, as an example? It's about helping those individuals pay down that credit card debt, build a budget, build an emergency savings plan that can take advantage of our high-yield savings plans, as an example. And then it's helping them increase their allocation to their 401(k).
That's a far more comprehensive and holistic approach to someone's long-term financial goals than solely the decision to increase your 401(k) allocation. And so we think that the tools and resources and experience that we have in being able to take that more comprehensive approach allows us to be able to provide better solutions for plan participants. And to partner with plan sponsors, the companies themselves, that helps improve the overall financial well-being of their employees.
FP: What do you think makes Goldman stand out in the market for workforce retirement advice?
Wilson: Goldman Sachs has often been at the lead intersection of working with employers to provide financial solutions, whether it's at the corporate level for their balance sheet, strategic decisions, tapping into investment banking, trading capabilities and — here — providing the advice and guidance needed to improve the overall well-being of employees.
And so we're partnering with intermediaries and advisors who are advising smaller companies. We are working with consultants, recordkeepers, insurance companies in a way that can deliver that personalized advice and guidance, taking advantage of the world-class insights, investment rigor, flexibility and solutions, and our ability to incorporate company benefits.
