5 Tips for Better Employee 401k Education Meetings

The five best ideas to make yourself irreplaceable with plan sponsors

401k, participants, retirement savingHere's how to ensure employees are engaged, inspired and (apparently) ridiculously good-looking.

Inspiring participants to save more for retirement is the primary reason I first started to focus my advisory practice on retirement plans. Through behavioral finance and psychology research, as well as my own trial and error, I’ve learned a lot about how to inspire and motivate employees to participate and save at higher rates.

Here are five of my best ideas to better engage employees and make yourself irreplaceable in the eyes of the plan sponsor:

No. 1: Stop talking so much about investments

Our job is not to make employees investment experts. Our primary job is to get people to a successful retirement. Most employees don’t care how Trump will impact markets, how much international exposure one should have, or how a mid-cap and a small-cap fund are different. We all like to tell ourselves that investment education is important, but if you see employees dozing off during your presentation, you’re probably talking too much about the investments.

Instead, limit yourself to five minutes or less on investment-related topics, and devote time to other topics that employees are much more interested in (see No. 2 below).

A good substitute for an investment-focused meeting is to encourage employees who have specific questions about their 401k investments to sign up for a one-on-one meeting with you and your team after the meeting.

No. 2: Answer employees’ burning questions

Since you’re no longer boring the employees with your impressive capital markets knowledge, you can focus on their most burning questions as it relates to saving for retirement, namely:

  • How can I balance saving for retirement with my immediate financial needs today?
  • If I increase my contributions, how will that impact my take home pay?
  • If I’m not in a position to save more for retirement today, how can I get there (i.e. how do I prioritize and tackle my financial issues like building up liquid savings, paying off debt, living within my means, etc.)?

No. 3: Customize your message

Plan sponsors usually have a pretty good pulse on the financial health of their employees and the unique challenges that their employees face. Have a conversation with the plan sponsor about those challenges and use their responses to customize your message.

If you’re working with a small manufacturing company with lower paid workers in their 30s and 40s, your message should be vastly different than the message to a group of anesthesiologists in their 50s.

If the employee population is large and diverse in age, you might also consider different group meetings for different ages of employees, so you can customize the topics to each age group. Millennials and Gen Xers might benefit more from topics related to debt reduction, while Baby Boomers will want to better understand their social security filing options.

Customizing your message to your audience also allows you to take the opportunity to experiment with different topics to see how effective they are. Personal finance topics abound, and the amount of research, articles, and blogs on the internet can provide excellent material for your audience.  Don’t be afraid to try something new. Ideally, your presentation should be fresh and new each year, since different topics will resonate with different employees.

No. 4: Get the plan sponsor’s buy-in                            

Is the 401k education meeting mandatory for employees? Do the company executives attend the meeting? Plan sponsors send a convincing message to their employees about the importance of the 401(k) plan, so be sure they’re sending the right message.

If you’re offering one-on-one meetings, it’s also a good idea to coordinate those with plan sponsors in advance of the meeting. Posting the sign-up sheet in the break room isn’t going to cut it. Create a strategy with the plan sponsor to encourage employees to sign up for one-on-ones that include proactively reaching out to the employees.

For smaller populations, ask the plan sponsor to personally pass around a sign-up sheet and encourage employees to sign up. For larger populations, try an online calendar for 10-15 minute meeting blocks that sponsors can email to their employees that include reminders as the meeting date approaches.

No. 5: Always have a call to action

What good is an employee education meeting if employees leave the meeting and do absolutely nothing? Make it as easy as possible for employees to change their deferral rates. If possible, give them a paper deferral change form and ask for a specific action–like increasing their deferral rate by 1 percent. Then provide a deadline–no more than a few days–for turning in their form. Giving employees everything they need to take action, and having a deadline prevents employees from putting off these important changes.

Dr. Stephen Covey said: “Begin with the end in mind.” With a little extra effort and a focus on the outcomes you want for the employees you work with, you can develop excellent presentations that inspire employees to take action.

Ashley M. Micciche, CRPC, QPFC, is Vice President/Investments with the Wilson Financial Group of Stifel, Nicolaus, & Company, Incorporated.  Member SIPC & NYSE in Portland, Oregon. Contact her at (503) 499-6260 or [email protected]

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