Over half of working adults are concerned they won’t manage to save enough money to cover their expenses in retirement. And while individual workers certainly need to take responsibility for prioritizing that milestone, employers can definitely help.
Most employees would like more support from their employers in reaching their retirement goals and feel they need help in determining how much they need to save for a secure retirement. If you’re interested in helping your workers better save for retirement, there are steps you can take to make that happen.
Offer a Stong 401(k) Plan
Many companies sponsor 401(k) plans, but that doesn’t mean they’re offering a good one. In fact, a bad plan could actually cause your employees to fall short on their long-term savings goals. So what sort of plan should you strive to offer? Seek a plan that can be structured to accommodate profit-sharing and/or matching company contributions.
Automatic enrollment in a 401(k) with opt-out provisions, salary deferrals, employer contribution options, and account review and retirement calculators can be quite helpful.
Certain plans could be built with a Roth elective deferral to provide tax advantages to both your employees and your company. Make sure that the plans meet non-discrimination requirements, and can be combined with other retirement offerings.
Provide a Generous Employer Match
Roughly 92 percent of companies that offer a 401(k) also match employee contributions to varying degrees, however, just because you offer a match doesn’t mean it’s a great one. Generally, when companies match employee contributions, they put in 50% of what their workers put in up to a certain percentage of salary. But the higher that percentage is, the more opportunity you’ll allow employees to save.
Educate Workers on How to Invest Their Savings
Offering a great 401(k) plan with a good match will assist employees in saving for the future. But many workers also need guidance. A majority of millennial employees claim they would greatly benefit from personalized investment advice for their 401(k)s.
Many workers are not well versed in investing or may have difficulty balancing their aversion to risk with their desire to accumulate adequate wealth. Help by bringing in independent financial advisors or consultants who can walk employees through their investment options and provide the guidance needed to make smart financial decisions. Consider hosting general financial wellness programs designed to help workers better manage their money as a whole.
Commonly, employees are distracted on the job due to financial issues. Make it easier for your employees to save for retirement, so they’ll have one less thing to stress about, and that in turn, can boost productivity and lead to better retention.
About The Rubin Group
Based in New York, The Rubin Group provides insurance in most of the 50 states. Our full-service insurance brokerage provides insurance and risk management services to individuals in all income brackets and businesses of all sizes and types. We understand that every client has unique coverage requirements, and we are passionate about providing the ideal individualized coverage for each customer. Each member of our team takes the time to truly understand your situation, the particular risks you anticipate – and the very real risks you’ve not yet contemplated. For all of your insurance needs, contact us at The Rubin Group!