401(k) Specialist Issue 3 - 2017 - 31

401(k) ADVISOR VOICE
5 Tips for Better 401(k)
Employee Education Meetings
By Ashley M. Micciche
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:
#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. 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 in which employees are
much more interested (see No. 2 below).
A good substitute for an investment-focused meeting is to encourage
employees who have specific questions about their 401(k)
investments to sign up for a one-on-one meeting with you and your
team after the meeting.
#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.)?
#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 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.
Customizing your message to your audience also allows you to
take the opportunity to experiment with different topics to see how
effective they are. Don't be afraid to try something new.
" CUSTOMIZING YOUR MESSAGE TO YOUR
AUDIENCE ALSO ALLOWS YOU TO TAKE
THE OPPORTUNITY TO EXPERIMENT WITH
DIFFERENT TOPICS TO SEE HOW EFFECTIVE
THEY ARE. "
#4 Get the plan sponsor's buy-in
Is the 401(k) 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-onones
that include proactively reaching out to the employees.
#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.
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 miccichea@stifel.com.
ISSUE 3 2017 | 401kSpecialist.com
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401(k) Specialist Issue 3 - 2017

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