Building Real Retirement Readiness... on the foundation of physical and financial wellness
Hey, Plan Sponsor...
- Are your employees increasingly healthy and financially secure?
- How would you describe an employee who is "retirement ready"?
- How do you determine whether your retirement plan is "successful?"
- What impact do unhealthy, financially stressed employees have on your bottom line?
Three Key Components of Real Retirement Readiness
Health and fitness is the most important (and most neglected) part of a successful retirement plan. It determines everything from when employees retire (the #1 reason employees retire before they had planned is because of physical ailments) to what activities they will be able to enjoy in retirement. Poor health also drives one of the largest costs for most retirees – healthcare.
Financial stress is a leading cause of employee illness, it destroys productivity, and without financial wellness, there can be no improvement in real retirement readiness. Even if 401(k) balances are increased through auto features, the money will likely be lost to loan defaults, hardship withdrawals, or cashed out at termination of employment. Therefore, a termpory increase in an employee’s 401(k) balance does not equal an improvement in real retirement readiness.
With a foundation of physical and financial wellness in place, employees can begin building retirement savings. The crucial factor is the help employees understand the need to save, and to give them the education and tools to confidently make retirement savings decisions on their own rather than making them feel like they need an Advisor to do it for them.