Your 20-something employees are more worried about repaying student loans and moving into their first homes than saving for retirement. So convincing them to contribute to a 401(k) is often a tough sell.
In fact, only about a third of 21- to 30-year-olds contribute to their 401(k) plans, according to theResearch Institute.
The solution: Make your pitch relevant to their lifestyles.
Bruce Tulgan, author of Managing Generation X and founder of consulting firm Rainmaker Thinking, says youthful employees want lots of options and the flexibility to change their plans if a better one comes along. They cherish their independence, are comfortable with technology and like to feel in control of their own destinies.
Follow the lead of financial firms, which are appealing to young professionals by throwing them pizza parties instead of financial seminars and offering them financial-themed podcasts rather than printed brochures. Other ideas:
- Couch information about your organization's 401(k) in terms they can relate to. Use messages such as "It's your money," "It's your choice," and "Savings equals independence" to appeal to the group's independent streak.
- Personalize messages by customizing pay stubs to show how much the employee saved this pay period and this year, and how much those savings will reap during retirement.
- Ask employees to "earn their independence" by making sacrifices now so they will be financially secure in later years.
- Solicit personal "savings success stories" from young employees and share them with their peers.
- Make learning about retirement savings fun by using games and computer simulations.
- Offer training and financial education via computer-based self-study rather than through organized classes.