Magazine

Survey Says | Published in May 2017

Plan Participants’ Common Questions

By Rebecca Moore | May 2017
Art by Wren McDonald
From time to time, retirement plan sponsors tell us that they repeatedly get asked the same common questions by plan participants—such as “How does the plan work?,” “How much should I save?” and “What investment options should I choose?”
 
Many of these questions get answered in enrollment materials and meetings. But I was sure that, beyond these, other basic questions often get asked and re-asked. So we queried NewsDash readers, “Do you repeatedly get asked common questions by plan participants? And, if so, what do they want to know?”
 
Ten percent of respondents said they do not repeatedly get asked common questions, however 90% said they do. For example:
 
“How much am I deferring?”
 
“How much should I save?”
 
“Why can’t you guarantee investment returns?”
 
“It’s my money; why can’t I take it out whenever I want?”
 
“Will Social Security still be available to supplement my retirement?”
 
“How much do I need, to retire comfortably and not make major changes to my lifestyle?”
 
“Can I transfer my pension, prior 401(k), IRA [individual retirement account], etc., into my current 401(k) account?”
“Why can’t you just give me my distribution without my paying taxes?”
 
“How do I calculate how much to defer in order to maximize the company match, and what I can save under IRS [Internal Revenue Service] regulations?”
 
“What is the best investment class in our plan?”

 
Further, if plan sponsors have received such questions, we were curious about their reactions to them.
 
Seventy-five percent of responding readers work in a plan sponsor role, while one quarter of respondents are third-party administrators (TPAs)/recordkeepers/investment managers.

As always, all verbatim responses reflect the opinions of individual readers and not the stance of PLANSPONSOR and its affiliates at Strategic Insight.
 
“Not only do I not mind participant questions, I encourage them. It shows that they are at least trying to engage in the process!”
 
“We’re working on a Benefits FAQ [frequently asked questions], ... but no matter what we do, we know we can’t make people read it and they’ll still prefer to call or email us instead!”
 
“The most unbelievable comment/question received is ‘Just tell me when you think I have enough money to retire. You know how much I have in my account, and I trust your judgment and opinion!’”
 
“We did recently have a younger employee request the addition of a fund backed up with really good points. It created great dialogue amongst the committee and led to the addition of a similar fund that was more appropriate for the employer plan setting. Love stories like that!”
 
“All these questions are answered if participants would read the enrollment material, the SPD [summary plan description] or even the one-page summary handed out at enrollment and annually.”
 
“Any question is good because it means participants are taking their saving for retirement seriously.”
 

And the Editor’s Choice goes to the participant who said, “I blame technology and fee compression … Today, everything is done through the Web or email, and no one is there to review basic concepts with participants.”

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