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How to Increase the Value of Your Retirement Plan Without Spending More Money

July 10, 2000
Related Topics: Retirement/Pensions, Featured Article
In the competitive labor market, employee benefits have become the battleground for quality employees. Often, the decision between two or three companies comes down to one or two key benefits, and more often than not, it is the company retirement plan. Here are some creative ways to make your retirement plan more attractive without spending a lot of dough:

  • Personal financial planning for your employees. Many fund managers and administrators trying to separate themselves from the competition offer these services at no cost. These financial planners often will sit down with an employee and discuss topics ranging from the basics of investing to advanced estate and taxation planning.
  • Review your plan design. Many companies are trying to attract the right employee with the wrong benefit plan design. A company trying to attract younger employees with a traditional pay-upon-retirement pension plan will fail miserably. Adding in-service withdrawal provisions or loan abilities are hot requests among employees and cost the plan little to implement. Changing the type of plan you operate can even save you money in the long run.

  • Use word-of-mouth communication. In the midst of all of the required information you need to give to your employees regarding the retirement plan, your best allies will be your "retirement plan champions." These are non-HR people who understand the importance of retirement planning and the mechanics of your plan. Not only will these "champions" make your job easier, they will help explain some of the jumbled retirement jargon that is thrown around.

  • Benchmark your plan. If you feel you have a pretty good plan, put it in writing. Compare it to the other plans of companies the same size, or compare features of your plan against industry or national standards. Good hard facts always overcome rumors or misconceptions.

Some helpful sites for finding benchmark data and the ensuing process: Good article from CFO Magazine on areas to benchmark A wealth of summarized research data is available for all types of employee benefits, but especially retirement plans. The Bureau of Labor Statistics offers a periodic statistical review of compensation and working conditions. This page offers a PDF table entitled "Employee Benefits Survey" with a wealth of information by different worker classifications.

Link to related articles and vendors.

Recent Articles by William Dickmeyer, CEBS

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