Tag Archives: Millennials

Recruiting a workforce with intergenerational strategies

By 2020, five generations will work together at some companies for the first time. Human Resources (HR) departments that prepare to meet the different needs of each generation will secure the best talent. A recruitment approach that aligns corporate business strategies, internal equity, and employee compensation can be an effective strategy. Milliman’s Anthony Halim offers perspective in his article “Effective intergenerational employee compensation approaches.”

Five ways to motivate Millennials through employee communication

Gonchar-JessicaI know what you’re thinking: “Ugh, not another Millennial article.” But stay with me for a minute. As a Millennial myself, I have some insight on this generation.

Everyone knows that Millennials work differently than other generations, but actually motivating us to do something can be difficult, especially if you use the same communication you’ve always used. We are constantly bombarded with information from social media, texting, and friends, all of which compete for our limited time, so a long email about benefit changes likely won’t make the cut.

We now comprise over one-third of the workforce and are projected to be a majority by 2020, so it’s more essential than ever to understand what motivates us.

Whether you want to encourage us to enroll in a high-deductible health plan, contribute more to our 401(k) plans, or just get your message through the noise, here are five easy communication techniques you can use to motivate even the most indifferent Millennials.

1. Personalize it
Generic communication, as simple and cost-effective as it may be, is not the most effective way to get through to any employee, let alone Millennials. But personalized information is valuable information. A brochure touting the importance of contributing 1% to a retirement plan is not as powerful as a postcard projecting how much money I could save if I increased my 401(k) contributions by 1%.

2. Make it convenient
Making things quick and easy is key to getting through to my generation. For example, conveniences such as single sign-on and embedded links make a low-priority task like updating an address effortless and more likely to happen.

3. Go mobile
It’s no secret that we love our phones. Mobile communication provides a handy platform where information tends to be read within three minutes of delivery. Mobile communication also lets us access information where and when we want it, and supports real-time updates. Not everyone wants work notifications on their phone, but providing the option allows us more choice in the type of communication we want and increases the likelihood we’ll read it.

4. Keep it compelling
Another way to break through the noise is to make your message compelling and relevant. Remember, you’re competing against technology that is exceptionally good at monopolizing our attention. Emphasize why the communication is relevant to us. Is there a cash incentive for taking an employee survey? Will this program benefit our health in the long run?

5. Tell a story
Stories can be a powerful communication tool to engage and connect with the reader. Instead of sending an email that simply lists the benefits of enrolling in a flexible spending account, tell a story of an employee who has used the account with specific examples of what can be purchased pretax and how it saved her money.

It’s clear that Millennials want and need communication that is personalized, convenient, and mobile-friendly so we can engage with it when and where we want, compelling so we know why it’s important, and formatted in an interesting way. Using these five principles can help ensure you reach your ever growing Millennial workforce.

Want to read more? Check out this article on communicating across all of the generations in the workplace.

Retirement plan enrollment considerations

Employers are constantly seeking new ways to get employees enrolled in their retirement plans. This Plan Adviser article quotes Milliman’s Gerald Erickson and Jinnie Olson discussing how automatic plan designs and targeted communication strategies can affect the enrollment of participants especially Millennials.

Here is an excerpt:

When it comes to automatic plan design, says Gerald Erickson, a principal at Milliman Inc. in Minneapolis, the adviser community obviously supports these features. Still, it is important to acknowledge that while popular opinion claims auto plans are the next logical step in improving participant outcomes, “from a plan sponsor and an administrator/recordkeeper perspective, automatic plans are not easy to administrate.”

There’s a lot that goes on behind the scenes, he says, and that may include some mistakes. “I think it’s important for people to understand that it’s not as easy as just getting people to automatically go in the plan and think that’s the end of it. It does require a lot of work from the plan sponsor side, and it does require a lot of work from the recordkeeping/administrator side.”

Plan advisers should be wary of potential complications when designing their automatic features. Most retirement plan advisers are “looking at what makes the biggest impact in getting people in the plan,” Erickson says, which for Millennials may lead them to look at Roth options. “If you add a Roth feature to the plan,” he points out, Millennials that are in a lower tax bracket now can essentially “marginalize their tax hit by taking advantage of the tax-free distribution on the back end.”

Speaking for Millennials, Olson says, “We’re really the first generation that’s going to have to fund our own retirement, rather than relying on the typical defined benefit [DB] plan that’s losing popularity, and it can be really intimidating for people to hang onto enrollment packets for a year while you try to meet the eligibility requirements.”

…Advisers can help make an overwhelming amount of information more accessible for all participants, Olson says. “You want to be able to give that information to everybody but in a way that everyone has the opportunity to get through it and understand what it is,” she says. “Rather than a 15-page enrollment packet, maybe you pare it down to two pages, summarizing everything, but then give them the opportunity to look into it more later.”

Baby Boomers and Millennials: Two generations prepare for retirement

Murray-SarahMuch has been said and written about the differences between generations. Indeed, two separate studies recently highlighted retirement planning trends among two different cohorts. Baby Boomers were the subject of a December 2014 report issued by the nonprofit Transamerica Center for Retirement Studies (TCRS), “Baby Boomers Are Revolutionizing Retirement: Are They and Their Employers Ready?” and a younger generation got the spotlight in the Principal Financial Group’s 2015 Millennial Research Study.

The people of the Baby Boom generation have been trailblazers in many ways and it seems their retirement plans are no different. According to the TCRS report, Baby Boomers are changing the traditional idea of what the golden years should look like, out of necessity if for no other reason. A somewhat grim statistic from the report is that 41% of Baby Boomers expect their standard of living to decrease when they retire. With longer life expectancies, the rising cost of healthcare, and a lack of adequate savings, it’s no surprise that many people in this generation expect to work beyond the traditional retirement age of 65. Some expect to never stop working completely. Many call working in retirement the “fourth leg” of the traditional “three-legged” stool.

TCRS’s research found that there is a strong desire among Baby Boomers for phased retirement options, but in reality less than half of employers have practices in place—such as the ability to move to a part-time position while drawing retirement benefits—that allow employees to transition into retirement slowly. TCRS’s report discusses ways Baby Boomers can positively change their retirement outlook, such as keeping job skills up to date and seeking advice from a financial advisor. In addition, the report mentions ways employers can help employees transition into retirement, such as providing phased retirement options and educating employees on Social Security and Medicare.

What about the Millennials? While the Principal Financial Group’s report summarized results regarding all aspects of Millennials’ finances, the research included trends in retirement savings. Here are some encouraging statistics in Principal’s report:

• 82% of Millennials feel it is important to save for retirement
• 63% of them started saving for retirement at or before age 25
• 59% of them plan to maximize the amount of pretax contributions allowed in their accounts

Principal’s study also indicates that most Millennials believe they should be contributing more of their pretax pay to their employer-sponsored retirement plans than they currently are, but at least a majority of them have made the crucial step to start saving, no matter how small the contribution.

One notable difference in the generations is technology preferences and usage. Millennials are used to communication through employer websites, email, texting, and even social media sites such as Facebook. While these concepts certainly aren’t foreign to older generations, Millennials are more likely to expect their employers to communicate with them electronically rather than through traditional methods such as regular mail.

Another difference between the two groups is whether or not they expect to be able to rely on Social Security. While many Baby Boomers have already started receiving Social Security, the Principal report states that only 22% of Millennials include Social Security in their retirement planning, presumably because the system’s purported problems have been well covered in the media.

But let’s not pretend that different generations have nothing in common. It’s safe to say that the majority of American workers, regardless of age, know that retirement planning is important, but find it intimidating at times and can benefit from employer assistance. While Principal’s study states that 60% of Millennials expect to be better off financially than their parents, younger people may still find themselves in need of options such as phased retirement and can reap the benefits of an older generation paving the way for change.

As is always the case, the optimal retirement scenario occurs when both the employee and employer contribute to the success of the employee’s retirement goals. Employers can benefit from creating a workplace that supports workers of all ages. Recognizing the differences between generations, developing retirement planning resources that help employees at every stage of their lives, having a broad employee communication and education approach, and supporting phased retirement options can help achieve this goal.

Top 10 worldwide Milliman publications of 2014

In 2014, Milliman published a range of articles and videos, covering issues including retirement ideas for Millennials, the pros and cons of catastrophe models, the value of enterprise risk management (ERM) programs, and the impact of the Patient Protection and Affordable Care Act (ACA) on financial statements. We also published on challenges related to healthcare costs and insurance and risk management issues—and about real insurance for fantasy football and insurance for ride sharing. To view this year’s 10 most viewed articles and reports, click here.

Top Milliman blog posts in 2014

Milliman consultants had another prolific publishing year in 2014, with blog topics ranging from healthcare reform to HATFA. As 2014 comes to a close, we’ve highlighted Milliman’s top 20 blogs for 2014 based on total page views.

20. Mike Williams and Stephanie Noonan’s blog, “Four things employers should know when evaluating private health exchanges,” can help employers determine whether a PHE makes sense for them.

19. Kevin Skow discusses savings tools that can help employees prepare for retirement in his blog “Retirement readiness: How long will you live in retirement? Want to bet on it?

18. The Benefits Alert entitled “Revised mortality assumptions issued for pension plans,” published by Milliman’s Employee Benefit Research Group, provides pension plan sponsors actuarial perspective on the Society of Actuaries’ revised mortality tables.

17. In her blog, “PBGC variable rate premium: Should plans make the switch?,” Milliman’s Maria Moliterno provides examples of how consultants can estimate variable rate premiums using either the standard premium funding target or the alternative premium funding target for 2014 and 2015 plan years.

16. Milliman’s infographic “The boomerang generation’s retirement planning” features 12 tips Millennials should consider when developing their retirement strategy.

15. “Young uninsureds ask, ‘Do I feel lucky?’” examines the dilemma young consumers face when deciding to purchase insurance on the health exchange or go uninsured.

14. Last year’s #1 blog, “Retiring early under ACA: An unexpected outcome for employers?,” is still going strong. The blog authored by Jeff Bradley discusses the impact that the Patient Protection and Affordable Care Act could have on early retirees.

13. Genny Sedgwick’s “Fee leveling in DC plans: Disclosure is just the beginning” blog also made our list for the second consecutive year. Genny explains how different fee assessment methodologies, when used with a strategy to normalize revenue sharing among participant accounts, can significantly modify the impact of plan fees in participant accounts.

12. Doug Conkel discusses how the Supreme Court’s decision to rule on Tibble vs. Edison may impact defined contribution plans in his blog “Tibble vs. Edison: What will it mean for plan sponsors and fiduciaries?

11. In her blog “Retirement plan leakage and retirement readiness,” Kara Tedesco discusses some problems created by the outflow of retirement savings. She also provides perspective on how employers can help employees keep money in their plans.

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