The HR manager at Nathan’s Famous at a recent TPSU program held at Long Island University explains how her company achieved over 90% participation rate with happy employees through a unique program.
She meets with all new eligible employees explaining the benefits of a 401(k) plan and why they should join. If they decline, she asks them to think about it and talk to family members. If they still do not want to participate, workers must sign something that indicates that they made the decision not to join. Not only does this document provide fiduciary protection, it makes the worker think very carefully about what they are not doing. Very powerful which is why Nathan’s Famous’ participation rate is well over 90%.
Another key is making the eligible employee take to family members. At a TPSU program held at Rutgers University, a provider told the story of a very young worker with a +$40,000 account balance in a small town working at a local factory making relatively low wages. The worker explained that when he got out of high school, his mother said if he didn’t save 15% of his pay, he could not live at home. The results were awesome!
Though auto enrollment is effective, especially for larger companies where the HR manager cannot meet with all new employees, nothing beats engagement by employees in their plan. A fully engaged employee and employer working with an experienced advisor providing one on one holistic financial advice using a record keeper with state of the art technology is a recipe for a great retirement plan – which may taste almost as good as a Nathan’s hot dog.
