Build a Retirement Plan that Showcases Your Company Culture
Chris Dall [00:00:07] Thank you for joining us today. Financial security is an essential building block of well-being. When people don't feel financially secure, it takes a toll on their physical and mental health.
Chris Dall [00:00:19] This significantly increases the importance of helping employees understand how they can improve their financial wellness. Organizations can differentiate themselves to employees by operating their retirement plans as an example of their workplace culture. Commitment to employees well-being as shown through benefits and financial education that could help employees to become retirement ready.
Chris Dall [00:00:39] It is also important to include a focus on employees at all income levels within an organization to help drive equitable retirement outcomes.
Chris Dall [00:00:46] There are best practices that companies can consider with respect to their defined contribution plans to show this commitment to employee financial wellness.
Chris Dall [00:00:54] First, identify and prioritize groups that need the most help. Record keeper data about plan participants at the individual and aggregate level can be used to identify and target the employees who need the most support, such as those with low deferral rates or low balances. When plan sponsors regularly use inclusive language and focus on accessibility, this can also help employees to feel heard and understood. This can drive an increase in participation and engagement.
Chris Dall [00:01:19] Second, employee minimum annual matching contribution formulas. Designing the employer match to be the greater of 100% on the first 4% in employee deferrals or $2,000 in annual contribution is an example of a policy that can help employees reach retirement savings goals.
Chris Dall [00:01:38] Third, add a profit sharing component to the 401k plan. Beyond the positive optics of incentivizing employees based on the financial outcome of the organization each year, plan sponsors can consider being creative with the allocation formula and vesting schedule of the profit sharing component to boost retention.
Chris Dall [00:01:53] Once you create your story, it's important that you equip your recruiters and your managers with the tools they need to tell that story. Recruiters should be able to explain the retirement program and its benefits as a key part of the compensation offering and why a prospective employee would want to join your organization. Managers should be reinforcing the message with current employees, making sure they're taking full advantage of the benefits offered. This creates a culture where all employees are clearly seen and valued as a key priority, creating an important differentiator in recruiting and retention efforts.
Chris Dall [00:02:23] If you have any questions or would like to continue the conversation, please contact me or one of my teammates. You can also find additional information by visiting our web page. Thank you for your time today and I wish you all the best.
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