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The 401(k) dilemma. How managers can attract more employees to
Posted by randy on: 2005-12-19 09:34:38
The 401(k) dilemma. How managers can attract more employees to join company plans.
Tony Kent and Cathy Howley
Does the future look bleak for American workers?
A recent research statistic revealed that one quarter of
eligible workers choose not to contribute to the employer's
401(k) plan. Less than 10% contribute the maximum. (Source:
Center for Retirement Research at Boston College)
So if the employees aren't interested in participating, how do
you encourage them to get excited or even enthusiastic about
saving for the future?
A workplace retirement plan can mean the difference between a
costly retirement and an enjoyable one. But it's a hard sell,
especially if retirement is 25 or 30 years away.
Research also shows that education and communication have a
solid role for increasing participation and saving rates. The
main criteria needed for successful company education on 401(k)
plans are clear objectives, good targeting of messages, relevant
communication (which usually means keeping it simple) smart
evaluation and follow up.
In other words online education - but with a big difference.
Online is a medium that can capture attention in the most
intimate way. After all, you are sitting just a few inches away
from the computer screen, so you can make the space really work
in your company's favor. Try doing that with a brochure or paper
presentation.
- With online you can use a voiceover and graphics to simplify
complex issues and financial information for all levels of
employees.
- You can encourage interaction and involvement through a quick
quiz or light hearted questions.
- You can easily include calculators that clearly demonstrate
the value of contributing to a 401(k) plan over time. The
earlier you start saving, the healthier your pension plan will
be at retirement.
- Get the picture? Yes, why not use more of them to sell the key
benefits of being part of your company's 401(k) plan. No one
wants to read line after line of dull financial text. Make the
benefits animate and come to life in bold type.
The Pension Research Council at the Wharton School concluded
that "the largest effect on participant contribution rates comes
from raising the concentration of materials offered via the
web". It also estimated a contribution rate almost 50% higher
when communication was at a high level - a huge leap forward
from traditional education methods.
The problems that 401(k) plans face exists around the world
where saving for retirement is just as challenging. Take
Australia for example.
You can see some colorful examples of online pension education
with voice and movement at
http://www.options-strategy.com/super.htm. These examples also
include automated emails after the training to remind employees
of what they decided to do.
Better education and clearer communication. They're the keys to
successful online education and can go a long way to improving
your 401(k) figures.
About the author:
Tony Kent heads up Options Strategy a well-known Internet
Marketing Consultancy based in Melbourne, Australia. He is a
regular conference presenter. Cathy Howley is the Copywriter and
Creative Manager. Visit www.options-strategy.com
Open community website
http://www.business-business.biz
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http://www.business-business.biz
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