Ranking Retirement

Sponsored by: MFS Investment Management

A recent article cited research stating that only 36% of plan sponsors would rate their 401(k) plan within their top three workplace benefits offered to employees. Knowing that our membership skews towards companies that are committed to their 401(k) plans, I expected our data to be a little higher than average, but only a third of companies ranking it in the top three didn’t ring true to me. So, I asked members in this week’s QOTW how their company ranks their 401(k) plan in terms of their overall benefits offerings in thinking about recruitment and retainment. An overwhelming majority (91.6 percent) put it in the top three, with 40 percent ranking it second and half ranking it third (only 3 percent ranked it as number one). For a large percent, healthcare is the primary benefit with overall compensation and PTO other top considerations for employees. Comments (by rank) follow.

Top Benefit

• Employees don't really comment.  We auto enroll with annual escalations, currently with a 6% match.  Most employees do not touch their deferral rate or investment choices.  .
• For both recruitment and retention, the 401(k) plan ranks number 1 for benefits, just behind compensation.
• Our retirement benefits are a critical component to our overall benefits offering.
• The employees love our employer contribution rate -- up to 12%
• The retirement plans and health insurance seem to be the most attractive benefits to consider.
• we offer an extremely high level of employer contribution to our retirement plan so it is a very important part of our benefits package
   

Second

• a strong retirement savings plan is an important recruiting / retention tool, although health insurance is the #1 priority.
• Cost effective health benefits is number 1
• Either 1 or 2 on the rank from total reward philosophy
• Employer match, saving for retirement, financial wellness within the recordkeeper's system, etc.
• Good match feature
• Health benefits are #1
• Health insurance and related costs are probably tops on their radar.  I would say that PTO is pretty high up there, too.
• Health insurance is #1
• Health plan trumps retirement plan but both critical elements in attracting talent
• Healthcare coverage is our number 1 benefit. Then retirement benefits.
• I think employees look at health insurance, then retirement plan since the insurance plays a very current role in their financial picture and the retirement plan is generally far into the future.
• It depends on the demographic of the prospective employee...
• It is very popular
• It's an important part of our benefits package and is one of the key cornerstones with competitive pay and healthcare.
• Most prospective employees want an employer match.
• Our group health plan would rank first in employee satisfaction and our 401 K plan ranks a close second.
• Positive
• Retirement is extremely important to our employees and to prospective employees. Only behind medical.
• Second to health plan
• The biggest benefit we find employees look for is an employer match, which we do offer.
• They appreciate the non elective contribution and match
• Top benefit plan is our PPO medical plan.
• Very important but likely behind health care and for some folks - paid time-off
• Very popular
• Very popular among those over the age of 40; not so much for those under 40
• Very popular due to large ER contribution %.
• We have a generous match and is a huge draw for candidates and a big help with retention. We discuss the benefit often to keep it front of mind for employees

Third

• Compensation and Health Benefits seem more important to employees and prospective employees.
• First thing they want is a hybrid schedule and time off for vacation and sick. Second they need good healthcare. Then, they will ask about the 401k.
• For those who see retirement as a value it is high priority
• Health is always #1.  Paid Time Off is always #2.  Our CEO doesn't see the 401(k) as the benefit strength it can be to employees.
• I don't believe the younger generation(s) focus on the retirement plan when considering an employment offer. They are more interested in comp and flexibility.
• I think a lot depends on the employee - for more senior hires it is probably more important as they are more aware of future planning and retirement, but for new grads or younger hires I think the health benefits and work/life balance benefits are slightly more important to them at that stage of their career.
• Insurance benefits are always #1.
• It is important - healthcare is more important
• Our Medical benefits and pay rate are the top rated priorities for our employees and potential employees. Our retirement is third. The retirement plan is popular and the employees like the ease of the platform.
• Ours is right in the middle
• Popularity is good, but the waiting period is too long.  Shorter waiting period for PS - 3 years if hire before July 1 and 4 years if after. Fully vested.Not required to voluntarily contribute to get the PS.
• Retail - most want higher pay and health insurance, lots of PTO. High percentage of younger EEs, not yet focused on Retirement
• Retirement doesn't get as much screenplay as health insurance and PTO, but it's definitely a topic of discussion.
• We are working on enhancing our 401K plan to make it more attractive.
• We have a 95% participation rate, with an average contribution rate of 8%, our employees are very involved in the retirement plan.
• We promote our profit-sharing contribution when hiring people. With 5%, it adds more weight to the overall compensation.

Fourth

• Top benefits for EEs: salary, health insurance, PTO and then retirement...these are the top 4 and all very important