Creating Effective 401k Employee Communication for Different Cultures – Fred Talks. Hear from a highly successful communication expert about he has created effective employee communication for employees in 401k and 403b plans. The key is to understand their culture, how they think and their vernacular.
For example, Hispanic workers who statistically have among the lowest retirement savings rates, do not relate to the word “risk.” Instead, the advisor talks about short term and long term savings and uses the analogy of saving money “under the mattress.” Columbians relate to “putting money in a coffee can.”
No matter whether it is culture, age, gender or even industry effective communication “transcreates”, not just translates, difficult concepts. We also know that adults learn by interaction, not listening.
Watch this fascinating Fred Talk and help your employees improve interaction with their 401k or 403b plan.
See Full Transcript Below:
Fred Barstein: Welcome. This is Fred Barstein with this week’s version of Fred Talks and today we’re privileged to have Marco Molero from Qualified Plan Advisers. Welcome, Marco.
Marco Melero: Thank you so much for having me.
Fred Barstein: Okay if I ask you a few questions?
Marco Melero: Absolutely. Thank you.
Fred Barstein: Great. So, Marco is with a national advisory firm, works with plan sponsors all over the country and before that he had worked for a national record keeper.
Marco Melero: Correct.
Fred Barstein: Focused on education.
Marco Melero: That’s right.
Fred Barstein: So, Marco. The big dilemma is that we spend lots of time, lots of money on education and basically in 401K that has failed and for a lot of different reasons but you have focused on that and you’re finding some effectiveness, so how are you able to really do effective employee education?
Marco Melero: Well, first off, to begin, according to the Economic Policy Institute, what we have found out is they broke out retirement savings by ethnicity group and what they found out is that the US Hispanic has the least amount of money saved for retirement, or they’re the least prepared for retirement, so I focus on three key ways to engage the US Hispanic.
Marco Melero: Number one, I focus on providing a culturally relevant experience and if you’ve ever been to a social gathering and you talked to somebody what’s one of the first questions you typically ask them is, “What do you do?”
Fred Barstein: Where are you from?
Marco Melero: Where are you from? Well, what we found out actually is working with a US Hispanic work force is the first question I ask them in an education meeting is “Where are you from?” My family is from Mexico, I’m able to connect where they’re from and then provide examples relevant for them based on their country of origin.
Fred Barstein: So, give us an example of how you would do that.
Marco Melero: Absolutely, so my grandfather’s from Michoacan, Mexico, and whenever we would talk about saving, he would tell me to save it under the mattress, and it sounds like a joke and everybody in the room laughs about it, but they laugh because it’s so true, right? Because their parents taught them, their grandparents taught them, or they might be implementing that themselves.
Marco Melero: But if I’m talking to a group of Colombians, well, what’s big in Colombia? Coffee. And so my Colombian friends, they like to save in a coffee can. And so that is one of the ways that we can provide.
Fred Barstein: Talking their language, but also you talked about risk. You don’t use the term risk. Why not?
Marco Melero: So the second way that we engage employees is by trans-creating information, not translating it. And so what I mean by that is if you’ve ever heard the phrase, “It gets lost in translation,” well, it’s very much true, especially when it comes to a complex topic like retirement, so when we talk about investing for retirement or saving for retirement, we don’t use the word risk or [Spanish 00:03:01]. We talk about short-term saving, [Spanish 00:03:04] or long-term saving, [Spanish 00:03:07]. And that’s a concept that everybody’s well aware of, especially within that demographic.
Fred Barstein: And so what’s the third thing?
Marco Melero: The third thing is engaging and making sure that the employees or participants are interacting with us, and what we have found out is participants love to interact with us. They like to ask questions and we do a lot of polling and surveying, so we’re asking them questions to make sure they understand the key concepts, and B, what we’re seeing is we’re seeing the education meeting effectiveness increase because of that.
Marco Melero: And I like to track education meeting effectiveness, which is about 40 to 60%. What I mean by that is, if we meet 100 employees, what we’re finding out is 40 to 60 of them were either going to enroll into the plan for the first time or increase their contribution.
Marco Melero: I just had a meeting in Cleveland, Ohio two nights ago and all Spanish speaking construction company, 100% of the employees we met with that night enrolled into the plan or increased their contribution.
Fred Barstein: And the diversity concept applies here using Hispanic as an example, but it’s any.
Marco Melero: Correct. Seeing since the fact that my parents are both first generation from Mexico, that’s really where a lot of my passion lies, but you can use cultural relevance in this program really in any different demographic, whether that’s a gender, male versus female, or whether that’s an age demographic, having a different customized message for millennials versus those that are retirees, so you can use these three concepts and it’s again all about effective and customized education for your employees.
Fred Barstein: So talk in their language. So it could even be by industry.
Marco Melero: That’s exactly right.
Fred Barstein: Right. So I know that the most effective way to communicate is not that you’re so eloquent, it’s that you understand the person-
Marco Melero: The audience.
Fred Barstein: … the audience, and you talk in their language versus trying to get them to understand yours, which is a big mistake that we all make, so.
Marco Melero: That’s exactly right.
Fred Barstein: Well, very good. Well, thanks for your time today on our Fred Talks-
Marco Melero: Thank you.
Fred Barstein: … early on in that, and we’re trying to bring new concepts that maybe can help plan sponsors move the needle on retirement savings, so hopefully, this is helpful and look for our next version of Fred Talks coming soon.