Many times over the past several years, friends, colleagues and family members have reached out to me, vainly trying to understand what’s going on in our nation’s capital. These days, those roles have been reversed.
Reversed in that, over the past several months I have been reaching out to those friends, colleagues and family members vainly trying to understand what’s going on “out there.” It’s not that the frustrations, deep political divides and, yes – anger – aren’t to be found inside the Beltway. But I can’t remember a time when so many voters were willing to show up for a primary to voice those concerns in a tangible, loud, and (sadly) occasionally violent way.
I recently had the opportunity to sit in on a training session for a group of plan sponsors. In the course of the day, I was reminded of a couple of key attributes:
- Many, perhaps most, plan sponsors have responsibility for the 401(k) dumped on them.
- Many, perhaps most, plan sponsors have received very little training or education on how to deal with the 401(k) that was dumped on them.
- Many, perhaps most, plan sponsors also had a provider (and in some cases, an advisor) dumped on them with the plan.
- Many, perhaps most, plan sponsors have no idea how much they are paying for the 401(k) that was dumped on them.
- Many, perhaps most, plan sponsors are worried about all of the above.
Those concerns notwithstanding, I was struck then, as I am every time I speak with plan sponsors, by just how… “mundane” their truly pressing daily concerns are, certainly compared with the issues that dominate our coverage here.
Mostly they’re worried about things like correcting a misapplied salary deferral, nervous about the possibility of a contribution return to the CEO (again), uncertain about the outcome of a plan audit. Don’t get me wrong, they care about boosting participation and deferrals, emphasizing retirement outcomes, and the possibility that they are being gouged by unscrupulous providers – but those concerns are secondary to the alligators at their feet.
All that said, it was inspiring to watch this group of plan sponsors’ eyes light up at the prospect of being able to have a positive impact on their workers’ financial well-being by auto-deferring at higher levels than the traditional 3%, or reenrolling existing hires to (finally) get them in the plan, and into diversified investment vehicles, of using approaches like a “stretch” match to encourage more personal responsibility while being attentive to organizational budgets.
These are things they could – and should – have read about, of course – and they were put on the table in the session by a series of well-regarded retirement industry experts and advisors. However, it’s doubtful that they would have embraced it as realistic options but for the affirmation they got from the other plan sponsors in the room – others who had auto-enrolled at 6% and had nobody opt out (despite threats to do just that), who had reenrolled entire employee populations with no apparent backlash, who had stared down a recordkeeping provider who was resistant to change – and found another who was more willing to work with them.
There’s more than strength in numbers. There’s inspiration. And courage. And with any luck at all, change.
