What drives employee engagement in your 401(k) plan?
Hint: It’s personal.
Recognize that fledgling 401(k) educator above? If the desktop computer and hairstyle don’t give it away, it was circa 1995. 401(k) plans were just becoming a thing and we were out teaching people about the difference between their stock, bond, and money market funds (yes, many plans had just 3 funds), and American workers were starting to take responsibility for their own retirement.
Those days forged an unshakable belief in me that helping people with their money is personal. Did the overhead transparencies I carried around showing the power of saving early change the world? Perhaps not, but anyone who does 401(k) education knows, the magic is what happens after the meeting. It’s the light going off that causes someone to hang out after the meeting to talk about something money-related that is causing them stress or worry. Asking how they can get help.
Because helping someone get better at managing their money is not just helping one person. According to an American Psychological Association study, 80% of children say they learn their healthy habits from how their parents behave (including behavior around money). This means that helping just one person has a multiplier effect that can benefit generations of a family.
So, how do you help your employees get better with money?
Tip 1: Stop talking about the 401(k) Plan
Sure, there are times to talk about the plan. To communicate changes, introduce new services or a new service provider. Or to enroll new employees.
Tip 2: Talk about Money
Whether we love it or hate it, we all need (or want) varying amounts of it. We want financial stability at the least and financial security at best. Every single person who works for you has some type of money worry. Whether it is having student debt, needing to save for college or retirement, paying less taxes, or even protecting what we already have.
Tip 3: Find out what they worry about
Send an anonymous survey to employees asking them to tell you what about their money keeps them up at night. Or better yet, ask your retirement plan advisor to provide one for you. If they don’t have a survey, ask me, I’m happy to share one.
Tip 4: Find out how they want to access information
Do they like to read, watch videos, attend webinars, lunch and learns, individual meetings? Don’t assume you know. Money is personal and many people would never speak up in a group setting about their money. Don’t assume they want to watch videos just because it’s 2022, especially if they are long (over 2 minutes) or BORING. They will tell you if you ask.
Tip 5: Design a program to meet each group where they are
Do your Gen Z-ers want to watch short vids? Great, your plan provider probably has a whole library of videos you can link to via your Sharepoint or Google drive. Do older Millenials and Gen X-ers want to bring their partner or spouse to lunch and learn or happy hour (yes you can do a financial themed happy hour)? Your program does not have to be one size fits all, or boring.
Tip 6: The holy grail. Offer financial coaching. Period.
The only place you can be sure that each one of your employees will get the individual support they need is by offering individual coaching sessions with a financial planner or advisor. Whether your company is very large or very small, I promise you there is a good financial advisor or team who can serve you and your people. If you are looking for support for your own employees, reach out to me, and if I am not your gal, I am happy to introduce you to someone who is. I know teams who serve 50,000+ employees and those who serve companies with 5.
If you’d like a copy of my employee survey, request one here or reach out to me via Linked In.
Thanks for reading. Now, go take care of yourself and your employees.
Retire well.