2022’s most desirable employee benefit is a competitive retirement plan
Win the race for talent where other employers are falling short.
The pandemic has left employees stressed about money—and they’re turning to their employers for help. According to new research, 93% of employees want access to financial planning and advisory services from their employers, but only 28% of companies currently offer them1. With a gap in the market, a sure way to differentiate your company from those you’re competing with for talent is to offer a robust retirement plan solution for your employees and jobseekers. So how can you support your employees and make your retirement offering more attractive to prospective employees?
According to Craig Reid, Practice Leader of Retirement & Wealth at Marsh McLennan Agency, you have to start looking beyond just retirement and start looking at your financial benefits holistically. “Personal finances include more than just a 401(k) plan and for employees to feel truly financially secure, they need access to financial services that support all aspects of their financial future” Reid said. When looking to be more competitive with your retirement plan and other financial-related benefits, consider these four key elements:
Plan inertia
Many plans today are still not established to let inertia work in favour of the participant. In other words, the basic features and design of a plan should set the participant up for long-term success with the fewest decisions possible. Auto enrolment and auto escalation set at adequate levels, as well as annual re-enrolment to capture all eligible but not participating employees, are three quick and easy features that allow inertia to work in your employees’ favour. If your current plan doesn’t offer these auto-features, talk to your advisor to see if adding them makes sense for your plan.
Strong employer match
Investing company dollars into the retirement plan is a great way to invest in your employees and their futures. Implementing a best-fit employer matching formula and vesting schedule, while potentially including safe harbour options, can make your plan much more attractive to candidates.
Individualised experience
Many factors make a one-size-fits-all retirement plan impossible—age, income level, retirement goals, individual financial situations, etc. These are unique to each person and their financial services experience should be as well. Gone are the days when general assumptions are good enough for planning your retirement. Retirement expectations are different for each person. For instance, not everyone plans to own a convertible Corvette and drive off into the sunset along the California coast. Each plan member must have access to resources and plan features that allow them to tailor the experience to their personal long-term financial goals and objectives.
Participant support
Moving outside of the retirement piece of the financial services puzzle, we begin to look at financial well-being, specifically financial education and planning. Well-being has been a buzz-worthy topic for years now in the benefits world. And chances are, you’ve addressed it with a well-being program in your organisation. But what are you doing to address financial wellness? Addressing financial well-being starts with addressing financial literacy.
In a recent survey, only 50% of employees felt even somewhat confident in their financial health and wellness. Due to the cost of hiring a financial planner, many employees shy away from these services. Providing access to financial advice services gives your employees the tools needed to feel more confident in their financial futures and ultimately achieve retirement readiness.
Create a retirement plan experience that’s distinctly different—to help build a future that has no limits.
When it comes to the retirement needs of your company and your employees, there’s no such thing as one-size-fits-all. That’s why, at Marsh McLennan Agency, our relentless commitment to meeting your needs is anything but standard. We’re here to help you give your employees the financial future they deserve.
1 Source: The State of Employee Financial Health and Wealth - Origin