Benefits can play a critical role in attracting and retaining great talent. According to a Glassdoor poll, 57 percent of job candidates reported benefits and perks as their top consideration when deciding whether to accept a job while almost 80 percent of workers were found to prefer new or additional benefits to a pay increase. However, making it available to the staff is not enough. Successful adoption of financial benefits requires having a plan for awareness and understanding and then making it easy for your employees to take advantage of what is being offered.
Here are a few ways to help boost the adoption of your 401(k) benefits plans.
Understand why you care
Stressed-out employees can have a big impact on the quality of work being performed. Lockton, a private insurance company based in Kansas City, Mo., found that 1-in-5 workers reported feeling extremely stressed due primarily to their job or finances and those reporting high levels of stress were more than four times as likely to suffer from symptoms of fatigue, headaches, depression and other issues.
According to the International Foundation of Employee Benefit Plans (IFEBP), employees’ personal financial issues were affecting 60 percent of employees’ ability to focus at work and resulted in absenteeism and tardiness among 34 percent of those employees. The more financial tools you can equip your staff with, the more focused and productive they will be.
Education and awareness
Julie Stich, the director of research for the IFEBP found that nearly half of their organizations rate their workforce as only a little bit or not at all financially savvy. You cannot assume that just because your employees are intelligent or great in other areas that they are also financially literate. Create education and awareness opportunities that allow your staff to understand what their options are and how it can impact things they care about like taxes, saving, and financial security.
Do it automatically
The easiest way to ensure high adoption rates is to automatically enroll staff into your 401(k). You can help your employees save for the future, and give them a buffer against financial issues that may arise. They will have a window to opt-out if they end up deciding not to participate.
Give them money
Doing a 401(k) match, safe harbor, or profit-sharing contribution can go a long way towards incentivizing your staff to save for their future. The idea of leaving free money on the table is often a strong motivator for getting team members to take action.
Reduce waiting periods
If you require a waiting period of six months or longer before new employees can qualify for your 401(k) program, you might think about making the plan available immediately and instead phase in the matching component over time. This way you are not having to track down staff to try to educate them several months into their tenure.
For some, the times in their lives where they are finding or changing jobs can often be highly stressful and they may want to save every dollar they have coming in to make up for expenses or lost wages. Once they have had time to get immediate financial affairs settled, they may be back in a mindset where they can focus on saving for their future again. For this reason, even if someone opts out of a savings plan initially, checking back in with them several months later might find them in a mindset where they can focus on the future again.
Accelefund is here for all of your 401(k) questions and can assist in creating a rollout strategy. Help your employees avoid financial stress by giving them the tools to plan ahead.