Reaching K-12 403(b) Plan Participants During the Pandemic

Advisers to K-12 school district employees often set up in cafeterias or teacher lounges, but, with schools closed, they are having to communicate in new ways.

Lisa Bamburg, co-owner of Insurance Advantage & LMA Financial Services in Jacksonville, Arkansas, is an investment adviser endorsed by the Arkansas Retired Teachers Association. She says 99.9% of her firm’s contact right now is through Zoom video conferences and phone conferences. “We love to see our clients—we miss the face-to-face,” Bamburg says. “Our office has not been open since March 20, and we have not met face-to-face with clients since then.”

Bamburg also uses Zoom to meet one-on-one with teachers to talk about retirement. “We’ve had a surge of teachers wanting to talk about retirement since COVID. It’s normal for some teachers to retire as of May 31 with a June 30 retirement date, but, because of COVID, more are scared to go back in the classroom,” she says. Bamburg explains that, under the current plan, teachers are going back August 24, and some districts will have a blended virtual/in-person instruction setting.

Bamburg says she prefers doing one-on-one discussions via Zoom rather than over the phone because she likes to be able to see the person.

“As a company, we had luckily been putting together digital tools for about two years now to support advisers and clients, so when things started shutting down, we were able quickly to pivot to a virtual world,” says Jon Reilly, head of Core Sales and Distribution for Voya’s Tax-Exempt Markets business in Orange County, California.

He says Voya was already conducting virtual meetings but that they went into overdrive in March and April. Voya uses Zoom, not only with participants, but with plan sponsors as well. “We told the team Zoom is definitely a required skill. We did some additional training on Zoom,” Reilly says.

Conversations during virtual meetings include making sure participants know how important it is to stick with their plan and to invest in the market for the long-term, and going over provisions of the Coronavirus Aid, Relief and Economic Security (CARES) Act, he says.

“It’s been very successful,” Reilly says. “We knew we had the tools and were well-positioned, but we weren’t really sure how it would play out. The feedback from our advisers and clients have been good.”

Bamburg’s firm is also doing pre-retirement workshops via Zoom for K-12 employees who may be preparing to retire within three to five years. These are 40-minute presentations and are school employee-specific. “Eighty-five percent of our business is school employees. We discuss their pension options; T-DROP, the Teacher Deferred Retirement Option Plan, and 403(b) plans,” Bamburg says. She explains that after 28 years of eligible service, active members of the Arkansas Teacher Retirement System (ATRS) may elect to participate in T-DROP in lieu of retiring and accepting a service retirement benefit. They no longer pay into the plan; their employers still contribute.

The Retirement Benefits Group at Equitable is trying to be a resource where it can, by speaking to participants and plan sponsors alike. It has participated in associations’ and business officials’ meetings. “Understanding the CARES Act, waivers for student loans and student loan forgiveness, and retirement readiness are big topics we’ve needed to address since March,” says Bernadette Mitchell, chief strategy officer of the Retirement Benefits Group at Equitable in New York City.

Pros and Cons of Virtual Meetings

One advantage to a virtual, pre-retirement workshop is that many employees don’t want anyone to know they are thinking about retirement, and they’re able to stay anonymous with a virtual meeting, Bamburg says. However, she says, a disadvantage is that it is “just better” when there is interaction between people.

Bamburg says she likes having the ability to do a Q&A in a Zoom webinar. “We have different breaks for answering questions. There is someone to monitor the questions,” she explains. “If the answer is specific to a person, the one monitoring questions will answer individually to him, but if the answer would benefit the group, then we’ll ask it out loud and answer out loud.”

“This has opened our eyes to the fact that we can reach even more people than in person. We can provide a benefit for more people, so we will do some things virtually even when we can go back to face-to-face meetings,” Bamburg says. “It is the new normal and I don’t think we’ll ever go back to the way it used to be. And, that’s OK, we’ve learned some things and all will be better off for it.”

While Reilly says he hopes things get back to normal—for everyone’s health and safety as well as to meet with participants and plan sponsors—he says he thinks Voya will continue its virtual efforts. He cites a Voya study which found about one-third of respondents said they believe technology will have the greatest impact on the way they will save and invest in the future. “We fully expect a hybrid of virtual and in-person,” Reilly says.

Mitchell says the majority of virtual meetings with educators have been one-on-ones because they are at home and not congregating as they did in school. And educators are asking for spouses or others to join the conversation.

“Getting that additional person to listen is a benefit of doing meetings virtually,” Mitchell says. “There are definitely silver linings. With technology, there is more engagement and it’s streamlined. Also, before, educators had only limited time, but now there is more time to talk through specific needs.”

She adds that many teachers have felt very disconnected, and having more time and streamlined technology has helped that. “Any time there is a crisis, people come together. This has brought us closer to our clients, not only from a financial standpoint but understanding who they are and meeting their needs,” Mitchell says. “Listening has been eye-opening.”

Virtually Is Not the Only Way to Connect and Educate

“We said, ‘Let’s not assume that we know anything,’ and let’s ask our clients, ‘How would you like us to communicate with your staff?’” says Mitchell. “That has been the best thing to do. We are getting very different answers in different places. We are keeping an open mind to be ready for virtual communications, but we’re also listening to what’s happening.”

Mitchell offers an example in a county level district in Florida. Usually, when school starts back, Equitable provides a lunch and an on-site booth. School started back last week, so Equitable did a drive-by breakfast, and a lunch as well, because there were so many people. Its staff wore masks and were there to help provide materials.

“Virtual is 95% of what we’re doing, but some schools have said, ‘We’re having new teacher orientation, so can you come in, maintain social distancing and provide digital materials?’ For one district in Maine, we were on a stage,” Mitchell says.

Voya recognizes that advisers have to do things to make sure people stay involved. “We still do a lot of phone calls. Some people are not comfortable with technology,” Reilly says.

If a participant or plan sponsor wants to reach an adviser, Voya’s advisers all have an online calendar system they can use. “We’ve pushed it out to clients so they can see available time slots and can sign up,” Reilly says. “We’ve seen a lot more usage of those online tools and good conversations coming out of calendared meetings.”

Mitchell says Equitable’s advisers also have an electronic calendar for school employees to sign up for discussions. “We’ve had it for a long time but now there’s more of a need,” she says.

Bamburg says her firm is relying on written communications. “We always follow up virtual meetings and webinars with email. Also, participants in the virtual events are put on a mailing list, and a newsletter goes out about three times a year. They can include information about retirement or 403(b) changes, such as what is in the SECURE [Setting Every Community Up for Retirement Enhancement] Act, as well as opportunities for future webinars or seminars,” she says.

Digital-tool engagement has been what Mitchell calls “off the charts.” For example, participants were sent an email letting them know they can enroll in their retirement plan directly on the phone or computer and use an e-signature. But, she says, some people can get a little frustrated with enrolling online. They may get caught up on something, need guidance or have questions. In those cases, advisers can use Microsoft Teams to talk to participants.

Equitable has also worked to eliminate the flow of paper. For example, some schools want the salary reduction agreement on their websites so participants can choose from different providers.

Reilly says Voya is also paying attention to who is calling in to its client care center or clicking through its website, making sure that when they want to take an action, if the call center or website doesn’t help, an adviser is alerted. “It’s been helpful because advisers are able to answer questions in real time. It’s a quick hand-off depending on advisers’ schedules,” Reilly says.

Preparing for the Fall

Bamburg is getting ready for the fall, when she will talk to new teachers about 403(b)s and the importance of contributing to them, as well as what to expect from the pension plan. “We have to encourage them and show them how to contribute to a 403(b). We teach them how to save incrementally, to start small and build up,” she says.

Voya is already planning virtual enrollment meetings for the new year. “We recently rolled out the ability to enroll in a 403(b) plan through Zoom,” Reilly says. Voya is working with as many school districts as it can to figure out the best way to have virtual meetings and make sure new hires understand the plan. “That will be the hardest piece as we move into the new year,” he says. “If schools don’t go back to in-person, what are the districts going to be doing? We’ve revamped our marketing material to emphasize the importance of saving and of saving early.”

Reilly points out that retirement plan education is not the first thing on school districts administrators’ minds right now, as they are trying to figure out how to open and handle the COVID-19 crisis. “Our sense is that once districts have a plan in place, they will work more closely with us to figure out how to reach new hires. It will be a combination of virtual meetings and marketing materials,” he says.

Going virtual was a big change, but it gets easier as things move on, he says. But, he also points out some people are getting “Zoom fatigue,” and are less interested in using video calls. “Some people want to talk to us. We’ve learned we need to offer options,” Reilly says.

Mitchell says advisers miss their clients. “Some tell clients, ‘Let’s meet in your backyard and social distance.’ There is enthusiasm for back-to-school meetings. Some are giving out masks, hand sanitizers and food at schools. They’re finding any way to connect,” she says.