Plan sponsors may finally be coming to understand that there is an ROI for their retirement plan — or at least that there could be a cost if they don’t pay attention.
According to Towers Watson’s 2014 DC Plan Sponsor Survey, larger and mid-sized firms are starting to see the cost of older workers not retiring because they have not saved enough — not only in the form of increased benefits costs and greater absenteeism, but also in lower productivity for less engaged workers just hanging on because they have to. And firing them could trigger age discrimination lawsuits.
So what are these firms doing? The Towers study of 457 plan sponsors found that 84% expect to increase efforts to educate and 78% will use more technology to deliver the message. Though education has mostly failed, and customization and technology will help, the fact that plan sponsors are starting to wake up about the long-term costs of not preparing their workers for retirement is the first step toward making an impact on retirement readiness.
Previous NAPA Net coverage of the survey focused on outsourcing and lifetime income options.
