How to Promote Retirement Savings for America Saves Week 2019

Fliers, social media and website banners can help get the word out

January 10, 2019
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America Saves Week 2019, taking place from Feb. 25 to March 2, is an opportunity to encourage employees to start saving through their workplace retirement plan as early as possible and, if they can, to increase savings each year—even if only by a small amount.

Increasing their savings rate is a way for workers to pay themselves more during their retirement years. Younger workers will benefit the most by saving more sooner, given the number of years those added dollars will compound and grow, retirement advisors say.

America Saves Week is coordinated by the nonprofit groups America Saves and the American Savings Education Council, which have provided resources that employers can use to communicate with employees. The groups recommend that employers:

Small Steps Make a Big Difference

Employers should help workers understand how small contributions can add up. Here's an example: If a 25-year-old employee making $40,000 annually increases his 401(k) salary deferral by 1 percent each year—such as during America Saves Week—then, after 12 years, he has boosted his retirement income by $1,930 per month, research by Fidelity Investments shows.

"We know life is expensive and people have competing financial pressures," said John Sweeney, former executive vice president at Fidelity. "The more regularly you can set aside money from your paycheck at an early age, the more grateful you may be when you retire."

[SHRM members-only toolkit: Designing and Administering Defined Contribution Retirement Plans]

Automating Savings

For employers, America Saves Week is a time to consider adding automatic enrollment and contribution-escalation features to their 401(k) or similar defined contribution plan.

Among members of the Society for Human Resource Management (SHRM) polled last year:

  • 38 percent automatically enroll new employees into a defined contribution savings plan. Employees can opt out. Plan sponsors are increasingly "auto-enrolling participants at 6 percent [of eligible compensation] versus the more typical 3 percent," said Aimee DeCamillo, head of T. Rowe Price Retirement Plan Services in Owings Mills, Md.
  • 20 percent automatically enroll current but nonparticipating employees into the plan annually.
  • 18 percent automatically escalate plan participants' salary deferral amounts annually, typically raising deferral rates by 1 percent of eligible compensation up to a limit of 10 percent.

Tools like automatic enrollment, auto escalation, employer match and catch-up provisions for older employees are giving employers the ability to customize their plans, thereby encouraging their workforce to save more. These retirement tools not only help to increase savings, but they help employers to retain and recruit top talent who are savvy when selecting their benefits plan.


Related SHRM Articles:

At Tax Time, Remind Modest Earners About the Savers Credit, SHRM Online Benefits, February 2018

How Improving Financial Health Boosts Productivity, SHRM Online Benefits, December 2017

Push 401(k) Default Savings Rates Higher, Researchers and Plan Sponsors AgreeSHRM Online Benefits, October 2017

Auto Escalation Beats Inertia, So Why the Hesitancy?, SHRM Online Benefits, February 2016

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