Five Ways to Effectively Promote Employee Financial Wellness

Five Ways to Effectively Promote Employee Financial Wellness

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Research from Northwestern Mutual’s Planning & Progress Study revealed that a solid third of all American adults have less than $5,000 put aside for their golden years. One of the biggest contributing factors to this low retirement savings rate is the lack of financial knowledge and general practice of saving, budgeting and investing. According to the American Psychological Association, money is reported to be a top source of significant stress among Americans. When people struggle to save for short-term emergencies, they’re unlikely to prioritize saving for retirement—which, for many, is an amorphous concept that may be decades away. Without education on how to avoid debt, select investments, or prioritize saving for retirement, employees may feel ill-suited to make their own investment decisions, even when it comes to taking advantage of the employer match. As a result, employers who promote employee financial wellness on a holistic basis are far more likely to see increased participation in workplace benefit programs.

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Five Ways to Increase Millennial Participation

Five Ways to Increase Retirement Plan Participation Among Millennials

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Millennials — loosely defined as those born between 1981 and 1996 — are quickly becoming the largest generation, slated to surpass Baby Boomers later this year. But unlike Boomers, many of whom are exiting the workforce with the proverbial three-legged retirement stool at their disposal (i.e. defined benefit plan, defined contribution and personal savings, and Social Security), the majority of Millennials haven’t saved a penny for retirement and likely do not have a pension plan, which makes it critical for plan sponsors to make efforts to increase millennial participation.

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Driving Plan Participation Through Education Efforts

Driving Plan Participation Through Education Efforts

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Sponsors know too well that a lot of planning and consideration goes into the design and maintenance of a retirement plan. But much of that hard work is futile without employee participation. Most employees understand the benefit of saving for retirement, and many are willing to invest funds in their employer’s program. However, they may lack basic understanding of how retirement plans work and may not be confident in selecting investment options on their own. Employees need to understand the benefits of the plan and how to use it in order to recognize its value. A robust employee education program can play a significant role in improving plan participation rates and will reinforce the value of the plan to employees.

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Attributes of a Successful Retirement Plan Program

Attributes of a Successful Retirement Plan Program

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Retirement plans can be a great benefit for drawing and retaining employees. However, is your retirement plan deemed attractive to current and potential employees? How does it compare to other employers you consider peers? An attractive DC plan does not happen by chance – it requires thoughtful plan design. If you craft a plan prudently and with their retirement in sight, it will be beneficial to both your company and your participants. We have helped many plan sponsors with their plan design and observed the main attributes that make a successful retirement plan program.

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Improving Employee Retirement Readiness

Improving Employee Retirement Readiness

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Recently, the focus of plan sponsors has shifted from reducing plan costs to ensuring plan participants’ retirement readiness and helping them set accurate retirement goals. As a result, the majority of sponsors are working to improve investment menus and change their plan design. Those, however, are only some parts of the overall picture for improving employee retirement readiness.

What retirees are the least prepared for and need the most help with are understanding how long their money will last in retirement, knowing how much they will need when they retire and preparing for the risks inherent to retirement. Here are four key aspects plan sponsors should consider to help plan participants aptly prepare for retirement.

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