401(k) Education and Advice Still Important in Plans

Target Date Fund401(k) education and advice remain high on the list of employer benefits.  Employers recognize that they must offer a robust, competitive 401(k) plan to attract and retain high-quality talent.  But employers are also aware that offering a plan only may not be sufficient.  What employers may not realize is the importance of 401(k) education and advice!  Employers are now aware they must also provide continuing education and partner with professionals.  Plan participants require strong support that can help employees understand how much to save and how to invest.

Employers have a sizable stake in ensuring their workforce understands how to make the most of the 401(k) plan.  It is also a strategy good to keep older employees on to mentor and train younger generations.  Older employees support legacy intellectual property in-house, however healthcare and other expenses also increase for employers as the workforce ages.  That’s one of the reasons it’s critical for employers to focus on outcomes and retirement readiness!  401(k) education and advice help employees make smart decisions about their savings.

As inflation continues to rise, many American workers are struggling to make ends meet.  Everything is more expensive, including gasoline and groceries.  Market volatility is also causing many to panic and pull out of their investments altogether.  Since saving for retirement is a long-term strategy, it’s important for participants to understand why they need to stay the course with their investments.  If they are closer to retirement, making adjustments to their investment portfolios can make sense for their age and stage of life.

While not a panacea, partnering with a financial advisor can help employers offer a more competitive 401(k) plan while meeting their fiduciary obligations.  It can also help assuage some of the panic brought on by market turmoil.  Advisors can help employees gain a better understanding of what it means, and how to adjust their strategies.  Advisors can help by calculating how much an employee needs to increase their contributions to retire on time.

401(k) education and advice gives participants an opportunity to partner with a financial advisor in your 401(k) plan, which empowers them and puts them in control of their retirement destiny.  The more participants understand market cycles and the impact of inflation on their savings and their future, the more likely employees are to stay the course and retire on time.  That becomes a reason for employers and employees to celebrate!


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