5 ways HR can help millennials be smarter than their parents about retirement

Getting younger employees to save for retirement is right up there with getting a finicky child to eat their vegetables. Sure, it's good for them, but it's not always what they want.

Participation rates and average deferral rates in voluntary enrollment plans for workers younger than 35 are well below those of other age groups, indicating that HR teams may need to take extra steps to reach this segment of their employee base, according to data from Vanguard, a leading 401(k) provider.

HR professionals are uniquely positioned to best assist younger workers. The best tack for HR experts to take with millennials in regard to retirement saving is to point out some of the mistakes their parents' generation has made in that area.

Help employees understand the destination
When it comes to saving for retirement, a lot of older workers are clearly lost. Younger workers have an opportunity to do a better job of staying on track.

Vanguard’s data show the average 401(k) participant within 10 years of retirement age (i.e., between ages 55 and 64) has a plan balance of just $69,097.

That may not provide much help over a retirement of 10 or 20 years.

Caution young staff members that one reason older workers are so badly behind in retirement saving is that they haven't checked first to see where they're going.

A MoneyRates retirement plan survey finds that 71% of workers within 20 years of retirement age still have not done a calculation of how well their savings will hold up over their retirement years.

Encourage your workforce to determine what enough savings is. Inform your staff that it only takes a few minutes to use a retirement calculator to see how much to put aside to meet savings goals. That way, your employees will know where their retirement plan is heading.

Educate employees on how to get debt under control
Saving for retirement is undermined when employees are also building up debt at the same time.

Stress that debt costs more than retirement investments are likely to earn, a dollar in debt can more than counteract the benefit of a dollar in savings.

According to the Federal Reserve's Survey of Consumer Finances, the typical household still has $69,000 in debt by the time the head of that household is within 10 years of retirement.

Notice that this figure almost exactly matches the previously-mentioned amount that the average 401(k) participant in that age group has. In other words, debt can effectively wipe out a person's 401(k) savings.

So, your team’s first step toward educating workers about building a more secure retirement should be to do something many in their parents' generation failed to do: get debt under control.

Teach employees how to spread savings to make the burden lighter
Retirement saving is a big job, but younger workers have something very important on their side: time. Emphasize that spreading retirement savings out over 25 to 40 years makes the job much easier.

It gets tougher if young workers do what many of their parents' generation have done--wait and then try to catch up in the last ten years or so until retirement.

The golden rule: Don't leave free money on the table
When employers provide a 401(k) match, all staff should understand there's a direct financial incentive to start saving now. Every time employees put money into their 401(k) plan, the employer kicks in some on their behalf.

If employees don't contribute money into the plan, they don't get this money from the employer. There's no going back in future years and reclaiming that extra money the employer would have put in on the worker’s behalf.

The only way not to miss out on this free money is to contribute each and every year— and to contribute enough to get the maximum employer match available.

Show employees the benefits of saving
A dollar saved today can equal $10 at retirement age.

Saving money is hard work, but HR professionals can show their employees that it gets easier when they let their investments do the work for them.

The investment returns earned become much more powerful when compounded over a long period of time. Compounding means earning a return not just on the original money invested, but also on the returns earned in other years.

Younger workers must recognize that a dollar invested today could be worth much more than a dollar invested toward the end of their career.

There are many people of older generations who would be a lot better off today if they absorbed each of these five lessons when they were younger.

SOURCE: Barrington, R. (14 October 2020) "5 ways HR can help millennials be smarter than their parents about retirement" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/opinion/ways-hr-can-help-millennials-be-smarter-than-their-parents-about-retirement


Virtual walks and free chocolate? What workplace pros say the new office will look like

Working remotely has become a new workplace normal and may continue to be so. Although it may be difficult for younger generations to acclimate to this working situation, there may be some benefits to it as well. Read this blog post to learn more.


The traditional office’s days are numbered; the office of the future will be a “collaboration center” with a mix of skeleton staff and remote workers meeting through virtual team walks and group meals via home-delivered Zoom lunches.

Millennials and Generation Z will have problems networking in the new remote work world with fewer face-to-face meetings; and mental health and well-being benefits will become more important than ever before.

Those were some of the predictions of compensation and benefits professionals at the first virtual gathering of the WorldatWork 2020 Total Resilience conference — a digital substitute for an annual conference that was supposed to be held in Minneapolis this year, but was postponed in response to the global coronavirus crisis.

"The office environment will change,” said panelist Steve Pennacchio, senior vice president of total rewards at Pfizer, during an online session on resilience on Wednesday. “Remote work is here to stay.”

Pennacchio said a number of companies will shut down their office space, which will have serious ramifications for commercial real estate and new entrants into the workforce, who will be at a particular disadvantage because of the limits of networking and source building through remote technology.

He suggested more virtual engagement tactics, including virtual walks or group activities, including having teams eat together with coordinated deliveries of lunches or chocolate. “Nothing hurts with chocolate,” he said. During the conference, which will continue with weekly panels through Sept. 2, organizers also hosted social events, including virtual trivia games and online networking.

Pfizer is investing $1 billion on development of vaccines and treatments for coronavirus, he noted. “Hopefully ours and others will work. The world needs more than one,” he said.

Likewise, Susan Brown, senior director of compensation at Siemens, said her company has focused on four key areas of building a team, culture, management team and employees who can adjust to the new environment through virtual meet-and-greet sessions and lunches where all team members must be present visually.

“The relationship builds with seeing each other,” she said. “The camera on changes the dynamic more than a phone call.”

Brown also noted tremendous innovation around talent management happening during the coronavirus crisis. She said that progressive companies have made a quick shift to focus first on the mental health and well-being of staff as a priority, rather than having an emphasis on business metrics.

“The whole conversation changed to focus on people’s health and safely, how they were feeling and empathetic messaging rather than a focus on business results,” she said.

WorldatWork CEO Scott Cawood, who served as moderator, noted that employers’ responses are being closely watched by staff, and other companies.

“COVID-19 doesn’t define who you are; it actually reveals who you are,” said Cawood, sitting alone on a stage with a white chair and house plant, as panelists called in from around the country.

Kumar Kymal, global head of compensation and benefits at BNY Mellon, said the global financial services firm has 95 percent of staff working remotely.

"Times of crisis and change give us permission to rethink the way we do things, and it's an opportunity to decide what really matters to your organization," Kymal said, noting that the company announced that there will be no layoffs in 2020 to put staff at ease.

Management response should focus on “speed, speed, speed,” he said about responding to challenges under the coronavirus crisis, with special attention to empathetic corporate messaging.

Kymal said at his company, management focused on a new framework to address healthcare concerns globally, with a broad overview of their healthcare plans. Second, management focused on addressing stress and anxiety, particularly with attention to messaging and staff feedback. They also put an increased focus on well-being and resilience strategies, and accelerated a mental health program to allow employees to assess their ability to deal with stress. Finally, BNY Mellon improved social connections for managers to lead better on connecting with various teams.

Looking ahead to the return-to-work phase of the crisis, Kymal said the stakes are high. Challenges include dealing with temperature scans, wearing masks, closed cafeterias and social distancing.

“As we're starting to plan what the return to office looks like, it's clear to us it has the potential to become an awful, awful employee experience,” he said. “We really need to rethink and redesign. What does an office experience look like? That's front and center in my mind.”

SOURCE: Siew, W. (08 July 2020) "Virtual walks and free chocolate? What workplace pros say the new office will look like" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/what-workplace-pros-say-the-new-office-will-look-like


A benefits wishlist for millennial employees

Did you know: 63 percent of millennials would struggle to cover an unexpected expense of $500. With millennials becoming the new core of today's workforce, many employers are tailoring their job postings, descriptions and benefits to correspond with the millennial wish list. Read the following article to learn more.


Millennials are the new core workforce. Their concept of work is different than the standards set by previous generations. They bring bold, new approaches of what work should be, how and where it should be performed, and what the rewards for work should be.

While this has made some employers uncomfortable, millennials are not likely to change their ways. Employers must reassess their concepts to bring out the best of the unique millennial personality.

When I look at the U.S. workforce, I see a dramatic shift in the attitudes, personalities and attributes of millennials, which makes up the majority of the workforce. Millennials bring many positive attributes to the table, including a preference for flat management structures, multiple degrees, technological skills, energy and self-confidence. They also have high expectations for themselves, prefer to work in teams, are able to multitask and seek out challenges.

However, millennials have the highest levels of stress and depression of any generation. About 20% of millennial workers have suffered work-related depression. Millennials want their own living space, but they’re less likely to become homeowners because of student loan debt. Only 6% of millennials feel they're making enough to cover basic needs, according to an Economic Innovation Group national survey of millennials. As a result, 63% of millennials would struggle to cover an unexpected $500 expense. This generation wants to live within their means, but they’ve never been taught how — they need and want to be educated on how to achieve financial independence.

Think about your corporate strategy for attracting millennials. Here are just a few of the ways companies are tailoring their job postings, descriptions and benefits to correspond with the millennial wish list.

Working with meaning. Millennials want to have meaning in their work. Past generations may have worked simply because they needed to pay the bills. Millennials want to get paid too, but they also want to know that their employer is doing more than making and selling products or services. They aspire to social causes and want to know why the organization exists and how they can personally participate and contribute in that culture.

Continued personal growth and career advancement. Millennials want to be coached and have work-life balance. They want management feedback, even if it’s negative. Regular pay increases and promotions are important to them too. It shows that you’re invested in their career path and value their contributions.

Flexible hours and the ability to work remotely. They want flexible hours and the option to work from a location of their choice. This flexibility also contributes to their desire for no added workplace stress. Technology has made it possible to connect 24/7 from anywhere on any device. If you have yet to adapt your culture to accept this new norm, you’ll likely be missing out on this generation of candidates.

Technology. Millennials are smart-device people. Who better to move your organization forward than the individuals who grew up knowing how to download and use an app, or create a widget that solves a problem? They think technology-first and is required for any organization looking to remain competitive.

Financial wellness. A robust financial wellness program that includes self-directed education, competitions, games and rewards will pique millennial interest. Products and services like financial coaching, cashflow tracking, early wage access and credit resources that address their financial challenges will keep them engaged. Above all, a financial wellness program must be tailored to each individual employee to achieve maximum participation and behavioral change.

Employers must be vigilant in order to keep the best and brightest talent. They should also be proactive in managing their employees on a personal level, especially millennials. Otherwise, they are likely to be disengaged and move on — and that will cost money.

As managers and leaders of the organization, it is your responsibility to ensure that millennials understand their future in the company and to communicate that they don’t have to go somewhere else to advance. Employers and leaders have a responsibility to provide millennials with a desirable place to land, and a culture that encourages them to thrive. Don’t give millennials reasons to leave your organization. We need to support them, engage them, reward them and give them reasons to stay.

SOURCE: Kilby, D. (6 November 2019) "A benefits wishlist for millennial employees" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/what-employee-benefits-do-millennials-want