Total Plan Assets: $389 million
Participants: 2,607
Participation Rate: 100% in the 403(b), mandatory
Average Deferral Rate: 8%—i.e., 5% mandatory, plus 3% additional voluntary
Default Deferral Rate: 5%
Default Investment: TIAA-CREF Lifecycle target-date fund
Employer Contribution: 10% to the 401(a)

SRC Inc. employees are on the path to retirement readiness from the start of enrollment. To thank are a mandatory 5% contribution that eligible employees make to the 403(b) plan—though they may contribute more—and a 10% employer contribution to the 401(a) plan on top of it.

But the research and development corporation, headquartered in North Syracuse, New York, keeps the momentum going with a focus on education. In fact, the company has found a way to make retirement planning almost fun. With the help of recordkeeper TIAA, participants can enjoy education through gamification, in which learning opportunities are wrapped around a game or competition.

Jim Holland, executive vice president of enterprise services at SRC, recalls a competition in which participants were educated about different financial aspects of the plan, with follow-up questions to test what they had learned. Each day, new questions appeared on the company’s internal website, and correct answers were rewarded with a prize.

“Simply running a contest and making it fun seemed to drive home more results for them,” says Kevin Murray, vice president of client consulting at Cammack Retirement Group, the company’s adviser.

SRC plans to make gamification an ongoing part of educating its employees about retirement principles, Holland says.

Right after the contest, the company saw a significant increase in the elective deferral, he notes. Employees’ average deferral rate is now 8%, up from 7% a few years ago. With the combination of employer and employee contributions, most participants have plan contributions of 18% annually. For the approximately 2,600 participants, there’s an average account balance of about $149,000, and, for active participants, that number exceeds $200,000. Holland says this increased participation is the culmination of a request for proposals (RFP) process the company conducted in 2017, which resulted in a more concentrated effort on education and retirement readiness.

SRC engaged Cammack Retirement Group to review fee structures and improve the investment lineup. After the initial restructuring, SRC realized that its plan could be managed more cost-effectively, besides improving communication and education. At the end of the process, not only had the participation rate increased 1%, but administrative costs had been cut by 54%—saving $330,000 annually. Further, the company implemented fee levelization and added a Roth feature.

“The big focus is always what’s best for the participants,” Murray says.

Yet another enhancement that resulted from the RFP: During individual meetings, participants can receive investment allocation fiduciary advice through TIAA. “If you’re meeting with someone and talking about it, more often than not [you] implement those changes,” Murray says.

TIAA provides a mix of group and individual meetings, along with online and phone education. Group meetings address age-specific needs, with educational materials also tailored according to age. Print and electronic communications cover various goals of the plan, whether it’s increasing savings rates, diversifying investments or creating a smooth transition into retirement.

“We’re growing steadily so we can’t just rest on our laurels from last year,” Holland says. “There are new people; they have different needs. It’s an ongoing process for us.” —Corie Hengst

 

 

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