If your organization provides a 401(k) plan, what’s the next step to improving participation and your employees’ understanding of the plan?
To maximize the value of your plan, your employees need to fully understand its benefits. Employee communication is an important part of the retirement plan process. Missing the employee communication piece to your retirement plan puzzle can lead to confusion and misconceptions about your plan.
Employee Communication Tactics To Improve 401(k) Plan Understanding
Taking a deeper look into employee communication tactics surrounding your retirement plan is worth the time and effort. Ensuring your employees fully understand and appreciate a high-value retirement plan is essential to the plan’s success. Incorporate these four measures to open the lines of communication.
1. Two-Way Communication Is Essential. Provide plan information in the form of company-wide meetings, educational sessions and one-on-one discussions. Open lines of communication help ensure your employees understand the importance of retirement plan participation and can have their questions answered. Don’t make it hard for your employees to seek information about your retirement plan. However, if you distribute 401(k) plan information but provide no opportunity for employees to offer feedback or ask questions, misconceptions about the plan will arise. Open channels of employee communication are necessary for your plan to succeed.
2. Be Thorough With Employee Education Materials. Distributing packets of information about retirement plans isn’t enough. Ensuring that your employees truly understand the 401(k) plans available starts with education. Offer webinars and record them so employees may reference them later. With the help of your retirement plan advisor, create and distribute educational materials. Then, schedule individual meetings to review the materials, explaining intricacies and answering questions.
3. Get Leadership Involved. Involve leadership in selecting a plan and providing feedback. Have the leaders of your company and trustees of your retirement plan attend meetings where the plan is explained to employees. When your company’s leadership is involved and visible, this sends a strong nonverbal message. Employees will see that leadership is open to discuss the retirement plan and is supportive and transparent about the plan that is offered.
4. Communication Doesn’t Stop With Enrollment. Your employees are enrolled in your 401(k) plan. Now what? Continue employee communication with regular check-ins. One option is to provide quarterly updates on the state of your employees’ retirement accounts. When your employees see how much they’ve saved in a quarter and how much your company has contributed, they may be encouraged to increase their contributions or reassess their financial plans. In addition to this update, consider scheduling company-wide meetings that coincide with the end of the quarter. New questions may have come up since enrollment or new employees may have joined the team.
By striving to improve employee communication surrounding your retirement plan, you’ll decrease confusion and maximize the value of your plan.
Is employee communication for your 401(k) plan falling short? Talk to a Richard Brothers financial professional about optimizing your retirement plan.
