In today’s work environment, one of the biggest struggles employers face is acquiring and ultimately retaining talented employees. No owner wants to worry about whether their top sales rep or executive is going to leave for a more attractive opportunity. While it is impossible to completely prevent this, there are things you can do as a business owner to ensure that you are competitive.
Retirement packages and 401(k) plans are a great place to start, as they are often overlooked when evaluating employee benefits that a company offers. Most 401(k) plans are put in place as a simple retirement planning tool for their employees, but the reality is that 90% of all employees aged 18-34 actually prefer more of these types of benefits over higher pay. A 401(k) usually ranks as one of the top five requested benefits.
There is no denying that when a potential employee is comparing the benefits packages of prospective employers, the structure of the 401(k) plan can have a substantial impact on his or her decision. There are various tools that you can offer within the plan to make it more attractive:
- Immediate Eligibility – Allowing new employees to sign up for the plan immediately, as opposed to having a waiting period.
- Investment Menu – Offering a 401(k) plan that has a wide selection of investment categories as well as both passive and active funds. This can reassure employees that the plan can satisfy any investment interest that they may have. Your plan can also include a wide array of asset classes and categories that many “prototype plans” may not offer.
- Employer Match – This is often overlooked by employers, but an employer match can help boost employee morale and attract new talent. You can utilize a vesting schedule to help retain top talent with a “golden handcuff” strategy to compensate them competitively while encouraging a longer tenure.
The bottom line is: Your company’s success is generally tied directly to the caliber of your workforce, and one of the surest ways to help attract and retain high-quality talent is to utilize a 401(k) plan as a powerful recruitment tool. While, for many business owners, this is something that you simply do not have time to worry about, there are resources out there to help ensure that you are always competitive from a structure and cost standpoint.
At Key Client Fiduciary Advisors, we specialize in designing and creating custom retirement plans, including 401(k)s, for each company we work with. We will design a plan to help keep your employees content and educated, and will provide each participant with the tools to properly plan for and succeed in retirement. We operate as a fiduciary for each client to offset the liability of the trustees, which 95% of retirement advisors do not offer. We also do this at a cost that is 40-50% lower than the industry average. Contact us today to schedule a consultation with one of our team members.
Key Client Fiduciary Advisors, LLC ((“KCFA”) is an SEC-registered investment adviser located in Fairfield, New Jersey. This blog post is limited to the dissemination of general information pertaining to KCFA’s investment advisory services. The information in this blog post should not be construed as personalized individual advice. A copy of our KCFA’s written disclosure statement as set forth on Form ADV, discussing KCFA’s business operations, services and fees is available upon written request.