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These are the communications Brayton McK. Connard, SPHR, director of human resources for Monroe County, New York, said his team used in 2007 during a plan service provider transition that presented a risk that separated participants might roll over their account balances. He said they provided information customized to retired and separated participants and the outcome was no appreciable change in the number of rollovers out of the plan during the post-transition time period. His team used an aggressive communication strategy as well to address the risk of outside financial professionals wooing participants into individual retirement accounts (IRAs) with higher fees and fewer fund choices. In addition, they were aware of more separations as Baby Boomer employees got nearer to retirement age and the County implemented layoffs due to the recession and local government fiscal restraints. The communications were as simple as possible and communicated the plan’s advantages. Connard said the County’s mailings have received positive feedback from participants who are surprised to learn (or be reminded) that they are not required to leave the plan at separation, can later access funds after separation without a 10% penalty and can rollover the funds at any future time. The mailing created no additional cost for the County; it was added to existing mailings, so there was no extra postage or extra staff involved. Additionally, when employees contact HR with pre-retirement inquiries, the staff emphasizes the benefits of keeping DC assets in the plan. When the plan provider receives a rollover request, someone contacts the participant and explains the advantages of staying in the plan. Connard said the number of rollovers by participants has been lower each year since the asset retention program was implemented in 2007. On the flip side, the program catches employees when they walk in the door, letting them know the advantages of rolling prior retirement plan assets into the County’s plan. The County has seen a more than 300% increase in the annual rate of rollovers into the plan. Connard said, to gain participants’ trust, “run a good plan.”
These are the communications Brayton McK. Connard, SPHR, director of human resources for Monroe County, New York, said his team used in 2007 during a plan service provider transition that presented a risk that separated participants might roll over their account balances. He said they provided information customized to retired and separated participants and the outcome was no appreciable change in the number of rollovers out of the plan during the post-transition time period.
His team used an aggressive communication strategy as well to address the risk of outside financial professionals wooing participants into individual retirement accounts (IRAs) with higher fees and fewer fund choices. In addition, they were aware of more separations as Baby Boomer employees got nearer to retirement age and the County implemented layoffs due to the recession and local government fiscal restraints.
The communications were as simple as possible and communicated the plan’s advantages. Connard said the County’s mailings have received positive feedback from participants who are surprised to learn (or be reminded) that they are not required to leave the plan at separation, can later access funds after separation without a 10% penalty and can rollover the funds at any future time. The mailing created no additional cost for the County; it was added to existing mailings, so there was no extra postage or extra staff involved.
Additionally, when employees contact HR with pre-retirement inquiries, the staff emphasizes the benefits of keeping DC assets in the plan. When the plan provider receives a rollover request, someone contacts the participant and explains the advantages of staying in the plan.
Connard said the number of rollovers by participants has been lower each year since the asset retention program was implemented in 2007.
On the flip side, the program catches employees when they walk in the door, letting them know the advantages of rolling prior retirement plan assets into the County’s plan. The County has seen a more than 300% increase in the annual rate of rollovers into the plan.
Rebecca Mooreeditors@plansponsor.com