Employees Need Help to Understand their 401(k) Plan

By Susan Reynolds, Director of Retirement Solutions

Even when your employees have a toolbox full of retirement planning tools and resources, they still need your help in learning how to get that toolbox open and use what’s in it. A 2018 survey of our 401(k) clients’ employees makes this clear. It sheds light on what employees are most interested in learning about their plans, and how they prefer to learn it.

The survey, by CUNA Mutual Retirement Services, measured over 9,200 responses from employees across 321 plan sponsors. A new eBook reports and analyzes the survey results.

Among the revealing results was how respondents described where they were currently on their retirement journey. They were asked to choose which of the following described them best:

  • 30% - I know what the plan is, but I could use some help with the tools and resources.
  • 25% - I’m in the plan, but I haven’t reviewed or changed anything since I first enrolled.
  • 20% - I am familiar with the tools and resources available to help plan for retirement.
  • 16% - I am confident in my understanding of my plan and how to use available tools and resources.
  • 9% - I don’t understand the plan or the tools and resources.

If your employees are like this survey sample, only 16% are confident they understand their retirement plan and how to use the available planning resources. The above responses indicate that the other 84% clearly need a little—or A LOT—of guidance. And remember what’s at stake: your employees’ ability to retire on their own terms. Most often, that’s the best outcome for the employee and your organization.

The survey also asked employees to rank their interest in specific finance and retirement planning topics. The two highest ranked topics were:

  • Understanding tools and resources available (chosen by 25% of respondents as the topic of highest interest).
  • Budgeting and managing debt (24%).

Another key question was about how respondents prefer to be educated about retirement planning. Employees made it clear—there is no one best way to deliver education. Preferences were closely split between live, in-person or virtual meetings, personalized email messages and on-demand tools like short videos and self-guided learning modules.

The eBook breaks down survey responses by age group, gender, and other factors, to give you a deeper understanding of how to create a retirement planning program that works for all participants. Download the complimentary eBook here.

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CUNA Mutual Retirement Solutions is a division of CUNA Mutual Group and the marketing name for CPI Qualified Plan Consultants, Inc., a CUNA Mutual Group member company. CUNA Mutual Group is the marketing name for CUNA Mutual Holding Company, a mutual insurance holding company, its subsidiaries and affiliates. Annuity insurance products are issued by CMFG Life Insurance Company, located in Madison, Wisconsin. Each insurer is solely responsible for the financial obligations under the policies and contracts it issues. Securities distributed by CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 866.512.6109. Non-deposit investment and insurance products are not federally insured, involve investment risk, may lose value, and are not obligations of or guaranteed by the financial institution. Representatives offer retirement and investment education but do not provide investment, legal or tax advice. Participants are encouraged to consult their own advisors.