Two years ago, my company, FJ Management — including Maverik Country Stores, Big West Oil, Tab Bank and Crystal Inns, implemented a program for our workers to help them save more through our company retirement plan. We also offered them free training with a financial professional. A year later, our financial planner was stopped by an employee at one of our Maverik Country Stores.
The clerk, a man in his mid-50s, thanked the planner and his employer for helping him start saving for retirement. He said, “this is the first time I have ever saved $1,000 in my life.”
Employees are grateful for employers that invest in them and their future. Also, employers benefit by having a workforce that feels appreciated, backed by financial commitments. FJ Management has learned many lessons as we’ve worked to increase the long-term financial security of our diverse workforce. Here’s why I encourage other business leaders to focus on long-term employee investments and what they should know.
First, most workers are not saving enough for retirement and employers have an important role to play in changing the landscape of retirement saving for millions of American workers. Research shows that 36 percent of Americans have saved less than $1,000 for retirement, while 60 percent have less than $25,000 saved. That’s woefully short of what they’ll need and will result in a workforce that is unable to retire past their prime working years.
We’ve also learned that most people think saving for retirement is complex so without guidance, they do nothing at all. Employers can break down those barriers by giving their workers the right tools to save and simplify the process. One of the tools we use is “auto-save,” meaning we automatically enroll our employees in the company retirement plan after working with us for a year.
It makes planning for retirement manageable and easy to understand, rather than an impossible hurdle that is overwhelming to even think about.
Auto-save features help remove some of the major roadblocks to saving — the questions of when to save, how to save and how much to save. Retirement plans offering auto enroll and auto escalate features allow workers to start saving immediately, and gradually increase their saving rate over time.
With the additional benefit of some financial education about where the withholding from each paycheck is going and how to manage and protect their growing nest egg, auto-save programs show employees that they are valued members of the company and help them feel empowered to create for themselves a more secure retirement.
I recently joined the Save 10 Coalition, along with several other Utah business leaders and companies, including Dave Petersen, CEO of OC Tanner, Corby Dall, president of 401k Advisors Intermountain, NuSkin, ARUP Laboratories, and dozens more, to begin a conversation about this important issue.
The Save 10 Coalition of business leaders is working to spread the word about the importance of helping workers save at least 10 percent of their income for retirement, and how this can be easily accomplished with auto-save features offered in company saving plans.
Providing basic savings tools to workers often comes at minimal cost to the employer but has major impacts on both the personal and financial well-being of their workforce, especially as growing life expectancies increase the number of years that Americans are expected to live off retirement savings.
Learn more about the Save 10 movement by visiting www.Save10.org. Better yet, join the movement to help your employees start building a stronger financial future for themselves. They’ll thank you for it.
Crystal Maggelet is CEO of FJ Management, a Save 10 employer.