Preparing for retirement in your twenties? Is that jumping the gun? Nope. Putting a savings system in place for the future is never a bad idea. To some millennials, retirement may not even seem real because it’s so far away. But there are major benefits to saving your pennies and getting a handle on financial wellness from an early age. Investopedia provides a few reasons why millennials at work should take saving for retirement seriously. It’s an easier time in life to save because they’re more likely to have fewer financial responsibilities. Compound interest can help that money grow over time. When you start saving in your twenties, your spending habits become more structured and disciplined.
With the outrageous rise in the cost of living as well as ballooning student debt, millennials tend to place putting money away for their 401k lower on their priority list. According to a report from the National Institute on Retirement Security, 66.1% of millennials in the workplace have saved nothing for retirement. Is this due to millennials being uninformed? Do we have access to a 401k or other retirement benefits? Or is it truly because we can’t afford to save? Let’s dive in and help employers and HR professionals prepare their employees for the distant but imperative future.
Prepare millennials at work before they sign up for their company benefits package.
Before millennial employees sign up for their company benefits package, give them a summary of what’s included and how they can use it to their advantage. Make sure they do research on their health benefits as well as the 401k or 403b plan. Any helpful videos or resources you provide are a plus, but distinct messaging for each topic will cut down on confusion. And don’t dismiss the need for education on the basics. Many millennials and younger employees are engaging with these benefits for the first time.
Provide options and let employees know it’s not a one-size-fits-all scenario.
The plan that works for one employee won’t work for everyone, especially when employees have widely different personal needs. Provide different options within your benefits package that work with the various lifestyles of your staff. This information will make the process less intimidating and more personalized. It will also show all your employees that you’ve got them covered, even if their situations change.
Utilize internal communications to promote money-saving tips and tricks.
Financial wellness programs and explanations for how those programs function will only take workers so far. There are so many little tips and tricks employers can share to help keep saving for the future in workers’ minds. The trick is to reach employees through effective internal communications. At Flimp Communications, we offer digital postcard campaigns for messaging employees on topics like financial wellness and saving for retirement. You could focus on newly enrolled employees who’ve never had the option of a 401k before. Tailor the message to them and provide tips for effective expense tracking, using auto deposits, investing technology and more! Depending on what information you provide, you could make these resources available to share through social media channels. When employees truly believe in something, they’ll want to share it.
Provide support throughout the process.
Preparing for retirement may be stressful for millennials at work but it’s significant, nonetheless. Act as a mentor for these employees by providing advice and concrete examples. Show them how much they could save if they start now! When you show constant support and teach them the ropes, they can help teach the next wave of new employees.
Retirement preparation isn’t just for middle-aged adults. Millennials need to take full advantage of their options so they can set themselves up for a successful future. It’s up to experienced employers and employees to help educate the younger generations. It’s one of those situations where firsthand experience can carry a lot more weight than theories and hypotheticals. Be patient and provide the wisdom you wish you had when you first started. Listen to millennials’ concerns too. You might find gaps in financial wellness coverage that HR can look to fill moving forward. You must know employees’ needs before you can help to meet them. The challenges of yesterday aren’t necessarily going to be the challenges of tomorrow. Use tools to help relay information and allow the message to resonate throughout.
Everyone deserves a fighting chance for a prosperous, abundant life, and that fight starts now.