How to Help Boomers Prepare for a Fast-Approaching Retirement
This article was updated on July 26, 2018.
For some workers, retirement is approaching fast. Case in point: the Baby Boomers, some of whom have already started collecting Social Security benefits just a few years ago. However, research also shows Boomers are easing their way into retirement, preferring to work part-time rather than leave the workforce altogether. This is just one example of why it's important that employers help their Boomer employees prepare for and transition to retirement. Yet, many employers don't recognize that communications around retirement savings aren't one-size-fits-all, and generational differences among their workers need to be considered.
To get help, many employers are beginning to look outside their organizations. Not surprisingly, a 2015 LIMRA Secure Retirement Institute study showed that 70 percent of employers said they will look to their plan provider for guidance on transitioning their workers into retirement. With a large portion of the population getting ready to retire, smart employers are realizing it's time to offer their workers guidance.
To ensure that you are properly preparing the Boomers in your workforce, consider communicating with them on the following points:
- Remind them it's never too late to start saving. It's better to have some money for retirement than nothing at all.
- Suggest they try living on their retirement income now. By putting away more of their pay for retirement savings, the Boomers in your workforce can add to their nest egg while adjusting now to their anticipated income in retirement.
- Show them how to take advantage of catch-up contributions if they are over 50. Your plan provider should be able to offer communications that explain to employees how this works and the benefits.
- Help them review their asset allocation. It's important for employees to know the percentage of stocks, bonds and fixed income in their portfolio, because that balance largely determines how much investment risk they are assuming. Speak to workers about ensuring that their investments are appropriate for their risk tolerance. Talk to your plan provider about holding ongoing employee education on asset allocation.
Communicating these points and supporting the Boomers in your workforce will help them transition into retirement.
