A New Way 2 401k

If I Hear The Words “Retirement Readiness” Again, I Think I Might Lose My Sh*t

If I hear the words “retirement readiness” again…I think I might lose my shit. It’s not that I’m not an advocate of the whole concept, because I am. My problem is that I just keep hearing a whole bunch of talk and I’m seeing very little action.

Enough with the power-points, enough with the podcasts, enough with the written articles. I don’t need another CEO of a large financial institution giving a keynote presentation on retirement readiness. I get it! I get it! I get it! What I want is some freaking action!

What is standing in the way?  It’s not that hard people. Let me give you a few quick ways to kick-start a retirement readiness program for your retirement plan clients. A simple way to just get started….you know…get the ball rolling or dip your toe in.

First let’s talk about the metric itself, I think it is important for a variety of reasons to establish some kind of metric for each of the participants (think 1-10 scoring system, or 1 to 100, or A, B, C, D, F… Hell, give em’ little gold star stickers if you want….I really don’t care what you choose, just choose one. What’s the methodology underneath the score? It doesn’t need to be that complicated, how about just taking the following items: Age, Compensation, Current Balance, Projected Rate of Return, Contributions, Mortality. If you want to get more sophisticated and add more items to your methodology then fine more power to you. Either way let’s choose “get-r-done” over spending the next 18 months developing and testing your theories.

Now that you have a score concept, work with your clients and vendors to get your hands on the participant data.  Let’s get this shiznit on paper.  I want a list of all the participants and their current Retirement Score, whatever that is. Now we set some goals and announce these goals out loud to the plan committee. Example: We have 40 plan participants. The average retirement readiness score is currently a 5 out of 10. Over the next 6 months I am putting the gas pedal down on a campaign of emails and personal meetings. My goal will be to increase their retirement readiness score by 2 points, bringing the company average to 7.

The Plan Advisor and the Committee will schedule another Retirement Readiness meeting for 6 months down the line to check and evaluate results. Measurable results and ongoing monitoring is key for a variety of reasons.

A couple of takeaways:
1. You should have increased your chances for client retention, the entire committee knows that you are in the middle of a 6 month process to make a difference.  They can’t fire you in the middle of your valiant efforts, that would be downright mean.

2. What if you fail? If you do fail and you cannot make the impact you were hoping for on the RR Score. This is a perfect chance to ask the plan committee to help you out. You tell them you have exhausted your measures and now they can with clear head and moral heart implement auto enrollment and auto increase. You are prepared to push them along into the auto-features NFL end zone by showing them statistics (click here for EBRI.org statistics) and industry success stories around automatic enrollment. You have already mapped out exactly how they will implement auto enroll (6% to start, 1% annually increase, impacting the entire workforce old and new). You just turned your failure into a massive success. Yay You! Damn, you are so good you even win when you lose.

3. If you don’t want to build your own retirement readiness score, as mentioned earlier, than just go purchase an already created tool/system. There are plenty out there to choose from. Already built for ya.


My Summary:  In the end, by taking action and implementing a measurable goal, your clients can’t help but recognize that they have a Plan Advisor that actually cares about the people and is committed to results AKA Moving The Needle.

FYI You want to win some new business? Document this process and the success it has achieved. Share it with your prospects and proudly say “Look what I could do for you” “If you hire me, I will make a measurable difference in the success of your plan”  You have actually tangible proof that you provide real value.

You want to see me really, really lose my shit? Send me a power point deck on the importance of “Financial Wellness” in the 401k space.

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