Why Your Retirement Advisor Should Have A Seat At The Benefits Table

HR consultant Julie Simmons and I recently discussed how to construct your total compensation strategy, and what you need to be thinking about in today’s environment. In this blog post I’ll talk about why your retirement advisor should have a seat at the table when it comes to putting together a total benefits package.

The Changing Role Of The Retirement Advisor

The retirement advisor’s role has gone through quite a few changes over the last couple of decades. It used to be all about the funds: making sure you had a “good” investment line-up, an investment policy statement existed, that the investments were monitored, etc. Next the focus shifted to fees, and then again to fiduciary guidance and governance. 

For us, it goes one step further (and another f-word for the sake of alliteration): Fit.  Where does your retirement plan fit within your company?  What place does it have within your hiring and retention strategy, your total compensation strategy, your total benefits strategy? What do you need to be thinking about, and what do your employees actually care about? What purpose does your retirement plan serve?

Every company has a different reason for why their retirement plan exists (assuming they’ve thought it through), and almost as many ways to structure their plans. Maybe you’re a nonprofit and you want to give back to your employees. Maybe you want your employees to feel like they have some ownership, and you make profit sharing contributions a part of your plan. Maybe you want to be better than your competitors, so you offer 11% instead of the industry average 10%. 

Your Retirement Advisor: A Goldmine Of Information

So what kind of information can your retirement advisor give you? You’d be surprised! Here’s a story that offers an example:

One of our clients is an 80-person urgent care facility with five locations. We conducted employee education meetings, which included 1-on-1 meetings, and discussed not only their retirement plan, but a basic snapshot of their other benefits and their financial situations, as well. We came away with some interesting observations.

The company had a retention problem, and we found out why: their competitor across town not only was offering higher wages, they were also offering additional benefits, including the for employees to take their birthday as a paid holiday. While it seems ridiculous, it was cited more than once in conversations. That was valuable information for the client to know, and that’s the kind of information your retirement advisor can give you. 

Our client also didn’t offer a match, which wasn’t exactly good for morale. I went to the CEO - with whom I have a good working relationship - and let him know what I had found out from talking with his employees. As a result, they were able to use that information to improve their benefits and retention. 

Your retirement advisor knows the retirement landscape, knows what your employees want, knows what your competitors are doing - all of that is valuable data. Use it to your advantage!

Here’s another story that highlights how your retirement advisor can give you the inside scoop on what your employees are thinking regarding benefits:

We had another client with a lot of long-tenured employees, and I clearly remember a conversation I had with one of them. When I brought up the company’s benefits, he stated, “Our benefits here are just terrible.” When I pressed him on it, it became clear that it wasn’t that the benefits were all that bad, in fact he had no knowledge of what would make them “good,” but that he felt unappreciated at his workplace. We were able to take that information back to HR and suggest that maybe a rewards program might be a good thing to implement, like recognizing service milestones or interdepartmental spot awards.

So why should your retirement advisor have a seat at the benefits table? Well, if we’ve met with your employees, there’s a pretty darn good chance we know what kinds of benefits they would appreciate. We also know where your retirement plan fits in terms of what your employees do and don’t care about. A little thing like offering a 1% higher match can make a big difference. 

Is it all about pay? Not necessarily. Like we’ve said many times before, communication is key - if you’re making it clear what other benefits your employees receive during the recruitment and onboarding process, that can go a long way in attracting and retaining top talent. 

Speaking of retention…the data speaks volumes. If that's a problem at your organization and you can identify the vulnerable points where employees will choose to go, you can offer benefits that kick in at certain times during an employee’s tenure. This is one area we were able to help another client alongside a long-term incentive program.

Bottom line: If you don’t invite your retirement plan advisor to the benefits table, you’ll miss out on their wealth of knowledge. And not just any retirement plan advisor - you want one who cares about their clients, and has a holistic view on how the retirement plan fits in with your other benefits. You want an advisor who has varied clients and experience, and can suggest different things to take advantage of. 

Looking for a retirement plan advisor who checks all the above boxes? That’s us! You can contact us here if you’d like more info on how we can help.