Posts Tagged ‘401(k)’

Help Employees Invest in Their Future

Thursday, November 10th, 2011

Many workers who have great concerns about their financial future are living from paycheck to paycheck as the country’s worst recession continues. According to a report from the Employee Benefit Research Institute, almost half of all Americans will not have enough money saved for their retirement years.

In his latest N & O column, “The View from HR,” CAI’s CEO Bruce Clarke dispenses helpful information regarding retirement savings to managers and their employees. Bruce says there are several reasons why people elect to not save: being young, weary about the stock market, laziness, general confusion and thinking their salary rate is too low.

In a recent study, ING found that 44 percent of its survey respondents said they probably would not be saving for their retirement if they did not have a plan from work.  Fifty-two percent of those participants said that their employers, above family and friends, have the most influence in getting them to start saving for retirement.

As an employer, knowing that employees place importance on company retirement plans should prompt you to help them utilize tools and information that are at their disposal for planning a successful retirement. Try the strategies below to help them invest in their future:

Communicate and Educate

Many workers believe that their organizations are one of the only credible sources for retirement information. Communicate to your staff why saving for the future now is the best way to be financially stable in retirement. Constantly remind workers of the different saving options and tools your company provides. Make sure they understand each option, and help them choose the best one for their situation.

Request Feedback

Because budgets continue to get cut, organizations are looking to reduce funding in certain business areas, and benefit allocations tend to go on the chopping block. Instead of drastically reducing the cost of each employee benefit, such as retirement and paid-time off, ask employees how they would prefer their benefits to be distributed. Offer workers several options, and have them vote to choose the best option for the overall organization.

Keep It Up

Continue to offer your employees the best savings and retirement plans your organization can provide. If your company elected to match employee savings in their 401(K)s, do not stop because budgets are smaller.  If your company is really unable to maintain the company match, ask employees to increase the amount of money they are saving to make up the difference. Consistently communicate the importance of saving.

“The lack of financial literacy is a bigger cause of our failure to prepare for the future than the actual inability to take small steps,” Bruce says in his column.

Educate your employees on the importance of saving for their retirement, and keep them informed on any changes to your workplace benefits.

Photo Source: Keoni Cabral

Benefits for Part-Time Employees

Thursday, May 12th, 2011

According to the U.S. employment statistics reported by the Bureau of Labor Statistics (BLS), there were 26,560,000 employees working part-time in February 2011.  Approximately 31 percent worked part-time because of economic reasons (unable to find a full-time job, full-time hours cut to part-time or seasonal declines in demand).  The remainder worked part-time out of choice or due to personal reasons such as child care, attending school, limits on social security earnings, etc. Women accounted for 62 percent of the part-time workers.

Because they are not as common for part-time employees as they are for full-time employees, benefits packages can be a huge recruitment and retention advantage for employers with part-time workers.  Although involuntary part-time employees will be moving on to full-time jobs as the economy improves, voluntary part-time employees are likely to seek out part-time jobs that offer the best benefits.

The latest data available from BLS regarding benefits for part-time employees was released in July 2010.  From that data, here’s the percentage of employers who provided specific benefits to part-timers (working 1-34 hours):

Retirement plan         39 percent

Paid vacation             37 percent

Health care                26 percent

Paid sick leave           24 percent

The CAI 2011/2012 Policies & Benefits Survey reports that roughly half of employers provide some benefits to part-time employees, with some on a pro-rata basis.  The majority require a minimum of 30 hours per week to qualify for benefits (although some only require 20).

Approximately 50 percent of employers (total responses) who provide part-time benefits provide 401(k), medical and dental insurance, life insurance, AD&D insurance and bereavement pay.  Sixty percent of non-union employers provide vacation and holiday pay.

Benefits provided may vary by size of employer.  For full data on the local provision of benefits to part-time employees and other benefits data, please see the CAI 2011/2012 Policies & Benefits Survey.

Photo source: Earls37a