Auto Features as Effective Plan Strategies

Clare Bergquist, director of service strategies for Charles Schwab and a discussion panel member on effective participation strategies at PLANSPONSOR’s Plan Designs 2006 conference, told attendees that they should not be shy when they decide which auto features to implement. The panel was part of a three-day meeting at a Chicago hotel.

“It sounded Big Brotherish a few years ago,” Bergquist recalled about auto enrollment. “But now there’s a lot of paternalism out there. (Plan sponsors say) ‘I want my people to have enough money for retirement.’ Think outside the box with respect to automatic features. There are many creative ways to employ them.”

Mary Willett, consultant and president of Willett Consulting, told discussion panel attendees that those trying to drive participation and deferral rates:

• Should simplify and automate their plans as much as possible,
• Need to forcefully advocate for the importance of their employees having enough money on which they could retire, and
• Should reform participation education efforts to be more basic.

As part of the of the employer’s retirement planning advocacy, Willett contended that advisors can also press plan sponsors to make employee education meetings more of a big deal. “You need to say to the plan sponsors, ‘You need to make this important. We have to get people into the meetings,'” Willett said.

Employers should also not be shy about promoting their benefits packages, said Willett. “This is an opportunity for you to say, ‘Hey employees. Look at what I’m providing for you.'”