OneAZ Credit Union

OneAZ Credit Union intentionally targets employees to receive approximately 20 “touch points” a year about its 401(k) plan, either from its recordkeeper Principal Financial Group or its adviser Retirement Benefits Group (RBG). Those educational contacts range from targeted emails to one-on-one meetings.

The Phoenix-based financial institution, which has 21 branches across the state, plus a corporate office with more than 275 employees, sees 401(k) education as part of the broader wellness program it does for all its associates, says Michael Emanuelli, executive vice president and chief administration officer. “We want to be sure that they understand what retirement readiness is, and how they can plan for it—and, of course, how they can take full advantage of our 401(k) plan,” he says.

Every year, OneAZ organizes a group education meeting focused on the 401(k) plan and retirement at each of its sites, typically in May. The Phoenix office of adviser RBG does the talks, and topics vary each year to keep them interesting. This year’s talk will focus on understanding the basics of Medicare.

Principal also comes onsite to each location annually to do one-on-one education sessions with OneAZ associates during their work hours. And OneAZ has a wealth management division that employees can utilize for general questions, Emanuelli says. “Our associates are free to reach out to an in-house financial adviser to say, ‘Hey, can I schedule a time to meet with you, and talk about what’s working and what I need to change?’” he says. Those sessions do not include fiduciary investment advice, he adds.

This year, OneAZ began to let associates listen to podcasts and webinars from Principal Financial Group on retirement readiness. “We allow that to be on paid time,” Emanuelli says. “It gives individuals the ability to go home and share the information they’ve learned with their partner or family members. Then they can discuss the amount of deferrals that they’re going to put into the plan, based on what they are planning for the future.”

OneAZ did a “soft freeze” of its defined benefit plan in 2013, so current employees in the plan at that time continue to accrue benefits, but employees who started after that do not participate in the pension plan. The plan committee decided to provide an extra contribution of 2.5% of gross pay for employees not eligible for the pension plan.

OneAZ aims to put employees on the right track by auto-enrolling new hires at 6%, paired with auto escalation, “We want to make sure that everybody is set for retirement,” says Kim Reedy, executive vice president and chief financial officer. “Our average deferral rate is about 7%, and our employer contribution is another 5% (for employees hired after the pension plan freeze), so we’re right at 12% for the total contribution. And research shows that people need to save 10% to 15% a year for retirement.”

The employer sees the business case for its substantial 401(k) contribution. “Turnover costs money, it truly does,” Emanuelli says. “So we do everything we can to ensure that we have an ‘employer of choice’ culture that motivates our associates to stay.”

—Judy Ward