Plan sponsors can benefit from motivated employees, and the 401k plan is a tool to achieve this motivation. What precisely can plan sponsors offer in addition to the usual company match to make their 401k plan more enticing, more attractive, more motivating?
Tag "saving"
Once a person enters retirement, the number of scenarios proliferate. Unless the plan sponsor is a financial professional, it’s going to be a challenge to quickly comprehend all these options.
This isn’t to say younger employees should be left out of this type of education altogether. They shouldn’t. It’s important the message is drip, drip, dripped from the beginning of the onboarding sequence.
Before you scorn the use of badges, remember, the company match is the ultimate badge. If you meet a minimum savings goal, the company awards you a “badge” of a matching contribution.
The mistaken promise of participation may have an all-too-familiar ring to corporate retirement plan veterans.
If you are responsible for 401k participant education or in any form of employee-based financial literacy program, you may want to adopt methods used by others who teach adults.
All these strategies can be employed today and have proven themselves effective. It’s unclear that disclosing projected retirement income will provide the kind of incentive that will work.
It’s not as if this “surprisingly secret” formula has run its course. The equation is so timeless, so simple, that it continues to work for those who have the disciple to follow its rules. Still, can today’s workers see this work for them?
Perhaps, just as plan sponsors have developed onboarding programs for new hires when it comes to saving for retirement, maybe they should add “unboarding” programs as a bookend for those nearing retirement.
When you’re not an expert in an important job that you need done, what do you do?
