Fall Check-In: Why Retirement Benefits Continue to Matter to Employees
As summer ends and fall approaches, many employers begin reviewing budgets, benefit programs, and priorities for the coming year.
During this process, employers often focus on the direct costs of employee benefits.
Fall is also a useful time to step back and consider the value those benefits may provide to employees.
Organizations may offer retirement plans as part of their employee benefits program. For employees, these plans may represent one component of their overall compensation and benefits package.
Retirement Benefits Continue to Matter
Employees today may face a variety of financial considerations. Daily expenses and long-term retirement savings goals can create competing demands on household finances.
Workplace retirement plans can help employees set aside savings through regular contributions over time. Features such as employer matching contributions, automatic enrollment, automatic escalation, and access to educational resources can help employers encourage employee engagement.
Employees often consider a range of factors when they evaluate employment opportunities. In addition to compensation, workplace benefits may influence how they view a prospective employer.
A retirement plan can serve as one component of an organization’s benefits package, providing employees with workplace retirement savings opportunities, and may complement broader recruitment and retention efforts. For employers, retirement plans may also complement other benefits within the employee experience.
Employees Need More Than a Plan
Organizations can help support employee participation through education, communication, and guidance related to their retirement plan. Retirement readiness tools, financial wellness programs, and access to professional guidance can help employees learn how their plan works and how it may fit into their individual financial goals. Employees who understand available plan features, including employer matching contributions, may be better positioned to evaluate how those features support their retirement savings efforts.
Looking Beyond Cost
While reviewing benefit programs, employers might find it tempting to focus on expenses. Cost management remains a consideration, but employers may also evaluate retirement plans based on how employees use and engage with the benefit.
Along with reviewing plan costs, employers may consider how the retirement plan fits within their broader benefits strategy and how well employees understand and use the benefit. A retirement plan can provide employees with a workplace resource they can use as they prepare for retirement.
As organizations prepare for the year ahead, they may benefit from reviewing employee awareness of available retirement benefits, participation in plan features, and the effectiveness of retirement plan communications. These discussions can help inform future benefits planning.
A Seasonal Reminder
Like the changing seasons, employee needs and priorities can evolve over time. Fall can give employers an opportunity to revisit their retirement benefit strategy and evaluate whether employees receive the education, support, and resources they need to make the most of the benefits available to them. As employers review budgets, benefits, and priorities for the coming year, retirement plans may warrant consideration not only as a benefit expense, but also as a component of the overall employee experience.
This is intended for informational purposes only. You should not assume that any discussion or information contained in this document serves as the receipt of, or as a substitute for, personalized investment advice from Savant. Please consult your investment professional regarding your unique situation.
Patricia L. Hutchinson
Director of Retirement Plan Services
AIF®, MBA