We know client and participants are all over social media, so why aren’t more 401(k) advisors using it to reach out? The instinctive reaction, of course, is compliance, but after years of wrangling, they seem to have figured it out. So what gives?
Roughly three-fourths of 401(k) plan participants are on Facebook, according to a recent report from Spectrem Group called Using Social Media and Mobile technology in Financial Decisions. Just over half (52 percent) use the professional networking site LinkedIn, while four-in-ten (43 percent) use YouTube. Nearly three-in-ten (28 percent) use Twitter, and even is gaining in popularity.
Not surprisingly, the highest percentage of 401(k) plan participant social media users are millennials under the age of 35. Of these, 94 percent report using Facebook, 71 percent are on LinkedIn and nearly two-thirds (65 percent) are on YouTube. But a significant majority of older DC plan participants are also on social media. Just under seven-in-ten Baby Boomers ages 50 and older report being Facebook users.
They are less prone than Gen Xers or millennials to be on LinkedIn (46 percent), YouTube (35 percent), or Twitter (19 percent).
Women 401(k) plan participants are much more active social media than their male counterparts, the Spectrem Group report finds. Eight-in-ten report using Facebook compared with 63 percent of men. Fifty-four percent use LinkedIn vs. 47 percent of men, while 46 percent of women respondents use YouTube compared with 38 percent of men.
Women are especially active on the photo-sharing social media sites Pinterest (37 percent vs. 9 percent of men) and Instagram (26 percent vs. 12 percent).
The conclusion?
Financial services providers looking to develop long-term relationships with retirement plan participants have incentive to establish a social media presence, especially among younger 401(k) plan participants, where it’s becoming the preferred method of information-gathering and communication.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.