Charles Schwab reports in a positive light that 43% of workers believe they are very likely to achieve their retirement goals. This is actually an indicator of a potential societal crisis. Less than half feel confident they will be able to retire? The silver lining: employers can increase retention and employee satisfaction by focusing on retirement and financial education.
Although employers are not responsible for teaching financial literacy or for offering any specific retirement benefits at all, this is an amazing opportunity to make employees feel more secure, safe and cared for.
Taking the time during onboarding new hires and at least annually for employees to really dive deep into explaining the retirement benefits you ALREADY offer is life changing! 😄
When saving for retirement and investing, time matters more than the amount of money you're putting in. The reason why many people feel like they won't reach their retirement goals is because they started later in life.
Especially if your employee population is younger, it is imperative that HR takes just a little extra time and effort to explain how saving for retirement works. Although this is less alarming to younger people, that is why retirement education is so important as it has the power to make a dramatic difference in someone's financial future.
As an example, showing how pretax deduction lowers your overall taxable income, so therefore when you put in say $200 into your 401k or 403b the deduction on your check is only $137.
A big looming cloud for many people is the thought that you need a lot of money to start saving and investing for retirement. This is simply not true. You can start with even $25!
Although HR and business owners cannot give financial advice, we can be encouraging employees to truly make the most out of the benefits they already have, changing their lives, the future of their family and their feeling of overall satisfaction at work.
