Even though job openings dropped from July to August, companies may still have to compete for good workers. If you’re looking for a job and your skill set is in great demand, you might still have your pick of desirable offers.
That is a worrisome statistic for any recruiting department attempting to attract and retain talent.
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Therefore, how do businesses develop and keep their best workers in the face of some fiercest competition in recent memory? Offering competitive pay and benefits is still at the top of the arsenal. However, another powerful weapon for winning the fight on talent may be hiding in plain sight.
Is the answer to attracting top talent right in front of our eyes?
According to our findings, retirement benefits, commonly disregarded as part of the overall benefits package provided to employees, have captivated the attention of today’s workforce. In particular, more employees are requesting lifelong income alternatives in their retirement plans.
According to the 2022 TIAA Retirement Insights Survey, more employees are very or extremely interested in guaranteed lifetime income inside retirement plans than in 2020 (54% in 2022 vs. 51% in 2020). Also, 48% of employees opine that their enthusiasm has increased during the pandemic.
One factor for the increase in employer interest
Employers are concerned that traditional target-date funds (TDFs) are not adequately preparing their employees for retirement. TDFs cannot guarantee a consistent and predictable income for the rest of one’s life. As a result, they’re looking into the benefits of offering guaranteed lifetime income options, known as annuities, to supplement non-guaranteed retirement income strategies.
Over three-quarters of employers are very interested in a new generation of traditional target-date funds/other asset allocation solutions that can include a lifetime income solution allocation.
Dispelling lifelong income misconceptions
Advisors and consultants can kick off the lifetime income conversation by refuting common annuity fallacies.
Defined contribution plans often include in-plan annuities and are widely acknowledged as a significant lifelong income source. However, some plan sponsors regard annuities as challenging to establish, costly, and unpopular with employees.
Other employers may believe that employees are not yet requesting annuities, which is incorrect. According to Aon, 80% of employees demand guaranteed retirement income, and over 70% of plan sponsors believe that lifelong income options should be incorporated into their DC plan.
How much is lifetime income worth in retirement?
A basic comparison could be helpful here. Many employees buy disability insurance to ensure an income even if they cannot work. People also purchase life insurance to protect their families if they die too young. Converting a portion of your retirement funds to lifetime income is similar. Annuitizing, rather than securing your income during your earning years, protects your income during your retirement years.
Before entering into any default negotiations, benefits departments must have open discussions. This would be whether they want their plan to stay a tax-deferred savings plan or whether they want to take the straightforward steps to upgrade it to a real retirement income plan. If the latter, the first step is to conduct research and select the category of lifetime income solution that best meets the plan sponsor’s objectives.
It is now time for a comprehensive benefits review.
The forthcoming annual enrollment season is an excellent opportunity for plan sponsors to remind employees of the importance of their retirement benefits as part of their overall pay package. While the benefits enrollment period is typically focused on health and welfare benefits, it is also an excellent opportunity to remind employees about the retirement program (s). This includes urging them to do the following:
- Participate as much as possible in their retirement plans.
- Begin planning a strategy to convert assets to long-term income in retirement and provide ongoing income to loved ones after they pass away.
- Make wise decisions now to position them for a confident and secure retirement.
- It’s also a good idea to keep reminding them throughout the year.
Note for employees: Listen and react when you highlight the importance of your retirement plan and set out the complete worth of your benefits package. It could mean distinguishing between attracting and maintaining top talent and losing out on top candidates.
Contact Information:
Email: [email protected]
Phone: 3234811328
Bio:
For over 13 years, Jason Anderson has served as a Personal Financial Advisor, Estate and Retirement Planner, helping to educate individuals from all walks of life and income levels on wise money investment and planning for a comfortable lifestyle and retirement.
Over time, Jason Anderson has become the ‘Go-To’ leading authority on personal financial advising, financial planning, and analysis, as well as retirement planning and financial planning for SMALL BUSINESS OWNERS. He also provides HIGHLY Popular financial education seminars for groups. These financial seminars empower people to more effectively budget, plan, manage their money, and achieve their personal financial goals. As a result of the excellent results, praise, and feedback that their financial seminars have received, the City of Los Angeles, The AFL-CIO union groups, as well as several other organizations, have decided to partner with Jason to more effectively accomplish their mission. He was also honored to be showcased in the November 2014 issue of Forbes Magazine “Americas Financial Leaders” and has been dubbed by the media as ‘The Financial Educator.’
Jason is passionate about the work he does because it brings him joy to help his financial planning and advising clients reach their financial goals. He finds excitement in assisting families in saving and paying for their children’s college education without stress, thanks to the financial plans he designs for them. He also takes pride in witnessing clients reach retirement and enjoy it precisely the way they desire.
Personally, Jason finds joy in being a husband and father of two wonderful children. In his spare time, he enjoys traveling, sports, hiking, and reading.
He works with Employees, Business Professionals, Business Owners, and ‘High Net Worth’ People.
► Like to discuss your personal financial situation?
☏ Call Jason at (323) 481-1328 for a FREE Consultation
✉ Email him at [email protected]
Disclosure:
All annuity and life insurance products are designed to supplement securities as part of an overall plan. The recommendation of annuities and life insurance is not designed to eliminate the need for securities in any way.
