Psychological abuse in the workplace too often goes unnoticed, unmentioned, and/or unaddressed, but the Workplace Psychological Safety Act - which is model legislation that has seen action in 3 statehouses already - seems poised to become the new template across the country for how psychological abuse is reported, managed, and prevented at work.
One recent survey indicated that nearly 7 out of 10 respondents had been bullied at work at some point in their career. The effects of this abuse were reported to range from depression and anxiety to loss of confidence and worsened health in general.
When these victims of bullying reported the abuse, however, nearly all claimed that despite raising the issue with HR, management, and/or state agencies, the vast majority found insufficient resolution to their issues and lost wages, incurred medical expenses, and/or left their jobs as a result.
While there are a number of current laws that address workplace harassment, including some that target bullying specifically, many only provide protections in cases where the abuse is linked to a protected characteristic, which can be difficult to prove and creates another hurdle to clear in seeking protection.
The Workplace Psychological Safety Act, on the other hand, has no such requirement that ties the bullying to protected status. Even though a disproportionate amount of such abuse falls upon women, older workers, and people of color, for example, removing the need to show that the bullying was a result of bias clears the way for an easier path toward ending that behavior.
In addition to removing those barriers and sources of complaint-fling discouragement, the Act also enables victims of on-the-job psychological abuse to request internal investigations of said abuse by their employers and to circumvent red tape that can sometimes bog down investigations conducted by state agencies. Victims would also be able to sue employers directly under the Act.
That Workplace Psychological Safety Act places many additional responsibilities for the handling incidents of psychological abuse on management and company leadership, as well, with the Act requiring employers to promptly investigate complaints and implement policies aimed at combating abuse in addition to mandating the quarterly reporting of diversity metrics and abuse data, which will be made available via public search in an effort to increase transparency and incentivize compliance.
While the Act has yet to be enacted by any state legislature, the momentum is clearly building - having already cleared the Senate in Rhode Island - and with an anticipated imminent introduction in New York and much outward signaling of support inside the Massachusetts statehouse, as well.
Given the the organization behind this model legislation was founded only about a year ago, and given the support that has been established already since, it may be only a matter of time before a version of the Workplace Psychological Safety Act makes its way to your state.
And given how much more happy, healthy, and productive a workplace and workforce can be when not distracted by psychological abuse, it may be in almost all parties’ best interest to encourage that adoption of the Workplace Psychological Safety Act in their own states as soon as possible.
You can read more about this topic here.
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While the term ‘Quiet Quitting’ has been around for less than 2 years since it was first coined, the phenomenon of employees knowingly giving less than their best efforts on the job has been around a lot longer than that.
The same can be said of ‘Quiet Cutting’- a term being used for what some have come to consider the managerial counterpart to quiet quitting, in which employers deliberately alter the nature of an employee’s job/role with the unstated intent of causing that employee to quit so as to avoid having to fire them.
While calling it ‘Quiet Cutting’ may be a relatively recent addition to the popular lexicon, not-so-subtly urging underperforming or otherwise unnecessary employees toward the door without forcing them through it is not exactly a modern invention either.
In fact, almost 1 in 4 employers has engaged in quiet cutting behavior - with the vast majority of quit cutters (74%) claiming to do so for the sake of performance management. Further, 13% of surveyed employers intend to make some additional quiet cuts from their staff within the next year.
Even though approximately 8 in 10 employers agree that the more professional approach would be to offer severance to employees whose absence has become more valuable to the company than their presence, it’s understandable why quiet cutting remains an all-too-common practice. The apparent advantages of indirectly encouraging employees to leave their jobs voluntarily seem obvious, most notably saving on termination-related expenses and avoiding the direct confrontation required to end someone’s employment with your organizations.
As this article in Bizwomen makes clear, however, the many downsides that accompany quiet cutting - which we have summarized and expanded upon below - far outweigh any benefits the practice may provide.
Clearly, employers would be wise to tread lightly before making quiet cutting a component in their management tool kit given the potential repercussions and limited upside.
And these dynamics are especially important to keep in mind in light of the coming compensation discussions that will be happening at companies through the end of the current year and into the beginning of the next, given that passing over employees for promotions and pay raises is the elder cousin to quiet quitting, and given that more than 6 in 10 (63%) of workers plan on asking for a raise next year and about half of the companies that intend to give out raises next year plan to give raises to fewer than half of their employees.
You can read more about this topic here.
Section 1: The Significance of Quality Sleep
In the modern workplace, sleep is a crucial, yet oftenneglected, component of employee well-being and productivity. Quality sleep isfundamental for employees as it plays a critical role in both their physicaland mental well-being, which in turn significantly impacts their workperformance and productivity. Adequate sleep rejuvenates the body and mind,leading to improved cognitive functions such as memory, attention, anddecision-making. This enhancement in mental faculties is crucial in a workplacesetting where focus and accuracy are paramount.
Moreover, quality sleep contributes to emotional stabilityand stress management. Employees with sufficient rest are more likely to havebetter mood regulation, which is vital in managing workplace relationships andnavigating stressful situations. This emotional balance fosters a positive workenvironment and enhances teamwork and collaboration.
Physically, good sleep strengthens the immune system,reducing the likelihood of illness and absenteeism. It also helps inmaintaining energy levels throughout the day, allowing employees to stay alertand engaged in their tasks.
Inadequate sleep, on the other hand, can lead to decreasedproductivity, errors, and accidents at work. It can also contribute to serioushealth issues over time, such as heart disease, obesity, and depression, whichfurther affect an employee's ability to perform effectively.
Therefore, promoting quality sleep among employees is notjust beneficial for their personal health, but it's also a strategic move fororganizations aiming to optimize performance, reduce health-related costs, andcultivate a productive, happy, and healthy workforce.
Section 2: Immediate Strategies for Enhancing Sleep
Implementing short-term strategies to enhance employee sleepquality can have a significant impact on their overall well-being andproductivity. Here are some approaches, including your suggestions:
Section 3: Long-term Wellness Initiatives
Implementing long-term wellness strategies in the workplace not only enhance overall well-being but also boost productivity and job satisfaction.
Section 4: Demystifying Sleep - Key Concepts Explained
An average adult should aim for 6-8 hours of sleep per night, though this can vary based on individual needs.
Section 5: Getting some shut-eye
Fostering good sleep habits in the workplace is a win-win for both employees and employers. It leads to a healthier, more engaged, and more productive workforce. Implementing both short-term and long-term strategies can create a supportive environment that values and promotes quality sleep. In the end, when employers invest in their employees' sleep, they are investing in the very heart of their organization’s success.
We are in to November and for some, beards are getting scraggly. No-Shave November, also widely recognized as Movember, is a unique annual event that encourages men to forgo shaving during the month of November to raise awareness and funds for men’s health issues, particularly cancer. The initiative emphasizes on cancers that commonly affect men, such as prostate and testicular cancer, and also highlights mental health and suicide prevention. As an employer, participating in and supporting No-Shave November can be a meaningful way to engage with your workforce and contribute to a significant cause, but it requires a thoughtful and inclusive approach.
No-Shave November is rooted in the concept of using the money typically spent on shaving and grooming to donate towards cancer research and education. It also serves as a visual reminder and conversation starter about men's health issues, especially cancer. Prostate cancer, for instance, is one of the most common types of cancer among men and early detection is crucial for successful treatment. By participating, employees can indirectly support the cause and spread awareness.
As an employer, it's important to encourage participation in a way that is inclusive and respectful of all employees. Participation in No-Shave November should be completely voluntary. It's important to acknowledge that not everyone can or wants to grow facial hair, and there should be no pressure to participate.
Use this opportunity to educate your workforce about men's health issues. Organize seminars, workshops, or distribute informational materials that talk about cancer prevention, symptoms, and treatments. Awareness is a critical part of the campaign.
You can support the cause financially by matching employee donations or organizing fundraising events. This could be a powerful way to show your company's commitment to men's health and social responsibility.
If your company has a strict dress code, consider relaxing grooming standards during November. However, it’s essential to maintain professionalism. If employees are in customer-facing roles, it’s vital to balance the spirit of No-Shave November with the expectations of your clientele. A well-groomed appearance can still be maintained while growing facial hair.
Provide alternative ways for employees to show their support, especially for those who can't or choose not to grow facial hair. This could include wearing a specific color or ribbon, participating in a charity run or walk, or volunteering at health clinics.
Be sensitive to those in your organization who may be battling cancer or have lost someone to the disease. No-Shave
November can be a poignant reminder of personal experiences, and it's crucial to approach the subject with empathy and respect.
Encourage conversations about men’s health in the workplace. Creating an environment where employees feel comfortable discussing health issues can be beneficial for everyone. This can also help in destigmatizing health-related discussions, particularly those involving mental health and cancer.
While participating in No-Shave November, it’s important to strike a balance between supporting a good cause and maintaining a professional image, especially in client-facing roles. Ensure that your employees understand the importance of looking presentable and professional, even while they are growing out their facial hair.
Consider implementing supportive workplace policies such as flexible hours for medical appointments or providing additional health resources. This shows that your commitment to men's health extends beyond November.
At the end of the month, recognize and celebrate the efforts of your employees. This could be through a company-wide email, a special event, or even a photo session of those who participated. This not only serves as a morale booster but also reaffirms your company’s commitment to health and social causes.
Use No-Shave November as a stepping stone for ongoing engagement in health and wellness initiatives throughout the year. This could include regular health screenings, wellness programs, or supporting other health-related causes.
No-Shave November offers a unique opportunity for employers to engage with their employees on a meaningful level, raising awareness and funds for men’s health issues. However, it’s crucial to approach it with inclusivity, flexibility, and sensitivity. By creating a supportive environment, encouraging participation in various forms, and balancing the need for professionalism, employers can make No-Shave November a positive, impactful experience for everyone involved, while contributing to an important cause.
Nashville, Tenn.– October 26, 2023 – Mployer, the leading independent platform for employers to research, review, and evaluate insurance brokers has named over 500 winners across more than 50 regions as part of its third annual “Top Employee Benefits Consultant Awards” for 2023. Mployer's Top Employee Benefits Consultant Award Program evaluates brokers based on breadth and depth of experience across employer industries, sizes, insurance products, and employer reviews. We recognize esteemed brokers that demonstrate market-leading competencies and a proven track record of success among employers, insurance providers, and peers.
Our team is proud to recognize this group of 2023 top-rated insurance advisors as part of our third annual Top Employee Benefits Consultant Awards,” said Brian Freeman, the Founder and CEO of Mployer. “Employer-sponsored healthcare and benefits cover over 150M Americans. Who an employer selects as their benefits advisor has more impact on employee cost and satisfaction with their healthcare than who an employer chooses as the insurance carrier. We have rated these brokerages utilizing sophisticated, industry-first algorithms, and we applaud the winners’ demonstrated commitment to service, quality, and positive employer feedback.”
Mployer determined the winners of the third annual “Top Employee Benefits Consultant Award” by analyzing each brokerage based on historical data, online reviews, their M Score rating, and demonstrated business experience.
The New York, NY area job market is competitive in the U.S. Northeast, employing more than 10 million people. Offering competitive employee benefits is a critical factor in hiring top talent for the region’s employers. Finding and partnering with a highly rated insurance consultant is imperative to retaining talent in any market.
The recipients of the 2023 “Top Employee Benefits Consultant Awards” for the New York, New York area are as follows:
The above winners are a snapshot of Mployer's matrices and proprietary M Score on June 15, 2023. To view a full list of consultants in the New York City area, visit MployerAdvisor.com.
About Mployer:
Mployer is changing the way employers search, evaluate, and select insurance advisors. The intuitive platform connects employers and employees to great benefits and insurance plans by providing employers with actionable data to easily evaluate and select the best advisor for a company’s specific needs. Most brokerages have a profile on Mployer, which provides independent ratings of insurance advisors to support employers. Insurance brokers cannot pay to influence their Mployer rating. Only highly rated brokerages are allowed to advertise on the platform. To learn more about Mployer, visit https://mployeradvisor.com and follow us on LinkedIn.
Disclaimer: Rankings are dynamic, and this report may not reflect the rankings currently listed on Mployer's website. Because Mployer research is ongoing, interested companies that want to join next year’s list are encouraged to claim their free profile on Mployer.
Media Contact:
Anthony Waters
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Two recent peer reviewed studies have come to the same conclusion - the workers compensation patients that they assessed were having worse post-surgical outcomes than non-workers compensation patients who underwent the same procedures.
Even though the workers compensation patients in the study were younger and in some ways healthier on average than the non-workers compensation group, in the year that followed their surgical operation, the workers compensation patients had lower return-to-work rates and reported a greater degree of pain and disability as well.
To be clear, these studies were published in the peer-reviewed Journal of Neurosurgery focusing on the spine and involved nearly 10 years of data from a large number of hospital systems, encompassing almost 40 thousand patients who underwent surgeries on a particular area of their lower spinal columns.
That said, there doesn’t seem to be a readily apparent cause that links these spinal injuries/procedures to the comparatively bad outcomes experienced by workers comp patients relative to the non-workers comp counterparts who had the same medical issue and received the same type of care to correct it. While the workers compensation group had greater proportions of patients who smoke and who are obese, whether or not a patient had workers comp status or not seems to have a greater correlation to these negative post-operation experiences.
The studies did suggest, however, that there could be a number of other factors that may very well have contributed to this phenomenon, including socioeconomic disparities between the workers comp and non-workers comp groups. Differing ranges of average injury severity between the groups could be influencing the results too.
Further, and perhaps most notably, there may also be differing incentives between workers comp and non-workers comp patients in assessing the severity of their injury and resulting disability in terms of maximizing disability payments and other related benefits that may become available as on-the-job injuries worsen.
The authors note that additional study is necessary to evaluate the various factors that are causing these disparities in post-surgical responses between workers comp and non-workers comp groups in order to determine which factors are most responsible. Once the main causes are identified, they can then potentially be better addressed in order to minimize their negative impact, which is especially important in light of the additional treatment expenses incurred by workers comp patients on average, as well as the decreased quality of life and increased likelihood of developing pain-management-related addictions as well.
You can read more about this topic here.
One of the latest benefits that has been growing in popularity among some of the top companies in the world is employers providing employees with special access to college admissions counselors.
The increasing prevalence of college admissions counseling benefits also coincides with the general rising popularity of education-related employee benefits, with a growing number of employers already offering tuition assistance and/or student loan repayment help and guidance.
Some companies that have added college admission counseling services to their employee benefits package offerings include JPMorgan Chase, American Express, Mastercard, and Johnson & Johnson.
While the practice of adding college admissions coaching has a longer history as a perk among hedge fund employees and other executives in the financial sector, the offering has seen much broader adoption in other industries in recent years as its effectiveness in attracting proactive, creative, and forward-thinking employees has been on display.
Further, given the high stakes and highly competitive college admissions environment, and given how the sometimes overwhelming nature of the application process can become somewhat all-consuming for applicants and their parents alike, offering benefits that can help both streamline that process and reduce the accompanying stress can be a significant benefit to business productivity as well.
While critics of college admissions coaching as an employee benefit rightly point to the fact that these offerings can worsen inequalities that already exist in the college admissions process, including inequitable distribution of limited college admission coaching resources as is, the effectiveness of this kind of counseling and its scarcity both increase the value of their value as an employee perk.
Currently, most families in the US depend on the advice and advocacy of the college counselors provided by the public high school system, who only spend about 22% of their work hours on college admissions advising according to the National Association of College Admissions Advising. Given the available time and resources and in light of an already overwhelming case load, it has become essentially impossible for college counselors to provide personalized attention to every student.
It’s also worth noting that one of the main reasons that personalized attention and the guidance of admissions counselors is at such a premium in the current admissions environment is the complexity of the admissions process itself. The colleges and universities themselves could take significant action to minimize the advantage that access to college counselors provides to applicants and close the outcome gap between the haves and have-nots simply by streamlining their own admissions requirements and updating their user interface to meet the abilities and expectations of their applicants without the assistance of third-party, professional help.
Often even more complex than the admissions process is the process of obtaining scholarships and financial aid. Finding applicable scholarships and/or other forms of financial assistance and then applying for those opportunities in such a way as to have a realistic chance of obtaining them is another area that admissions counselors can be crucial in navigating, which further exacerbates the inequality gap and places these forms of financial help further out of reach for those who need them most.
Until more colleges and universities take those steps, however, the value of college admissions counseling services as an employee benefit will likely continue to grow as more and more companies and their employees take advantage of the opportunity.
You can read more about this topic here.
There are many regulatory and other duties that a 401(k) custodian must perform for a retirement plan that they manage. These requirements make hiring the right custodian a crucial decision that can impact the success and effectiveness of your company's retirement plan. A custodian is responsible for holding and safeguarding the plan assets, ensuring compliance with regulations, and providing essential administrative services.
Each of these makes a 401(k) plan custodian an essential part of the team that works to ensure that your plan is set up to best suit the needs of participants. To help you choose the right one for your plan’s unique needs, this article will cover 8 common mistakes to avoid when hiring a 401(k) plan custodian.
One of the most significant mistakes made by employers is not conducting thorough research on potential 401(k) custodians. Many simply seek out well-known financial institutions without fully exploring the other options that may be available to them, without even knowing if they will be the best fit.
Take the time to research and compare multiple custodians, considering factors such as their reputation, experience, service offerings, fees, and client reviews. An informed decision can lead to a more suitable custodian for your plan, especially for a small business that may be low on the priority list for a large financial firm.
401(k) custodians may offer a range of service options, from basic recordkeeping to more comprehensive plan administration and investment management. It's essential to understand the scope of services provided by each custodian and assess whether they align with your company's needs. Choosing a custodian that offers tailored solutions can significantly benefit plan participants and streamline plan management.
The fees charged by 401(k) custodians can vary significantly and have a direct impact on the plan's overall costs and participant outcomes. Some custodians may have hidden fees or complex fee structures that can be challenging to understand. Look for transparent and competitive fee arrangements, and ensure you have a clear understanding of all costs involved.
If you later find that the custodian you chose has hidden fees that change your cost/benefit analysis, it may be worth your effort to find a new one.
401(k) plans are subject to various legal and regulatory requirements, including those set forth by the Internal Revenue Service (IRS), the Department of Labor (DOL), and the Employee Retirement Income Security Act (ERISA). Choosing a custodian that is experienced in retirement plan administration and compliance is critical. Failure to comply with regulations can result in costly penalties and liabilities for your company, even if done at the hands of your custodian. This makes it imperative to do your due diligence and find one who is dependable and has a history of meeting their requirements.
A user-friendly and technologically advanced platform can greatly enhance the participant experience and encourage engagement with the retirement plan. Look for a custodian that offers a modern, intuitive, and accessible online interface for both employers and employees. A seamless user experience can lead to increased participation and better plan outcomes.
A custodian's reputation and track record are indicative of their performance and commitment to client satisfaction. Consider reviewing client testimonials, case studies, and independent ratings to gauge the custodian's reliability and level of service. A custodian with a positive reputation and proven results is more likely to be a trustworthy and valuable partner.
You may want to ask potential custodians for the contact information of their current or former clients. If they balk at the suggestion, that may be seen as a red flag that prevents you from getting firsthand testimonials of their performance.
Efficient and responsive customer support is essential when managing a retirement plan. Consider how accessible the custodian's support team is and how they handle inquiries and issues. Timely and helpful customer support can resolve problems quickly and ensure a positive experience for both employers and participants.
Some custodians offer fiduciary services, which means they assume some or all of the fiduciary responsibilities for the plan. Engaging a custodian that acts as a fiduciary can provide an additional layer of protection for plan sponsors, as the custodian will share the responsibility of acting in the best interests of plan participants.
A 401(k) custodian has a major role to play in the administration and regulatory compliance of your plan. Choosing the right one that is the best fit for your plan is an important step in the process of building a plan for your employees, and should not be taken lightly.
Avoiding the common mistakes outlined above when hiring a 401(k) custodian is essential to establishing a successful and well-managed retirement plan. Conduct thorough research, understand the custodian's services and fee structures, ensure compliance with regulations, and prioritize customer support and user experience. A well-chosen 401(k) custodian can play a vital role in enhancing the retirement readiness of your employees and providing peace of mind for plan sponsors.
The Employee Retirement Income Security Act (ERISA) is a federal law that was enacted in 1974 to protect the rights and interests of employees who participate in most employer-sponsored retirement plans, including 401(k) plans. ERISA sets forth regulations and standards that govern the operation, administration, and fiduciary responsibilities of these plans.
It is imperative that any employer who offers a retirement plan to their employees ensures that they have a team in place that complies with ERISA regulations and filing requirements. This law was put into place to protect retirement plan participants, and significant penalties may be levied if a plan falls out of compliance.
In the article below, we will explore how ERISA impacts 401(k) plans and the key aspects that employers, plan administrators, and participants should be aware of.
ERISA stands for the Employee Retirement Income Security Act, a federal law that establishes minimum standards for private-sector retirement plans. Its primary goal is to safeguard the retirement savings of employees by ensuring plan transparency, fiduciary responsibilities, and accountability. ERISA covers various types of retirement plans, including pension plans, profit-sharing plans, and 401(k) plans.
ERISA sets forth comprehensive rules and regulations to protect participants in employer-sponsored retirement plans. It establishes guidelines for plan reporting, disclosure, and fiduciary responsibilities. ERISA also establishes the Pension Benefit Guaranty Corporation (PBGC), a government agency that provides insurance protection for certain defined benefit pension plans.
Under ERISA, employers are required to provide participants with important information about their retirement plans, such as plan features, funding status, investment options, and fee disclosures. Employers must also meet specific fiduciary obligations, which involve acting in the best interests of plan participants and beneficiaries.
ERISA applies to most 401(k) plans offered by private employers. The plans that do fall under its guidelines are subject to ERISA's provisions, including reporting and disclosure requirements, fiduciary responsibilities, and plan administration guidelines. ERISA helps ensure that employers and plan fiduciaries act prudently and in the best interests of the plan participants. These guidelines may seem like a headache to some, but they are in place purely to protect the employees who take part in employer-sponsored plans.
ERISA imposes fiduciary duties on those who manage and control the operation of 401(k) plans. Fiduciaries are required to act solely in the interest of the plan participants and beneficiaries, following the highest standards of care, loyalty, and prudence. They must diversify plan investments to minimize the risk of large losses, ensure that plan expenses are reasonable, and provide participants with accurate and complete information about the plan.
Fiduciaries are also responsible for selecting and monitoring investment options offered in the plan. They should act with diligence and expertise when choosing investment options, considering factors such as risk and return, diversification, and the needs and preferences of plan participants. 401(k) plans are not “one size fits all,” so the fiduciary must ensure that a plan is built in accordance with its participants’ needs.
While most 401(k) plans are subject to ERISA, there are certain types of plans that are exempt. Plans sponsored by governmental entities, such as state and local governments, are generally not covered by ERISA. Similarly, plans established and maintained by churches or religious organizations are also exempt from ERISA regulations.
To determine whether your 401(k) plan is covered by ERISA, you can start by reviewing the plan documents provided by your employer. ERISA-covered plans are typically required to provide participants with a summary plan description (SPD), which outlines key features of the plan and includes information on ERISA coverage.
Additionally, if your plan includes employer contributions or is administered by a third-party administrator, it is more likely to be subject to ERISA regulations. It's important to note that ERISA provides certain rights and protections to plan participants, so understanding whether your plan is covered can help you assess your legal rights and access important information about your retirement benefits.
ERISA plays a vital role in regulating and protecting participants in most employer-sponsored 401(k) plans. It establishes guidelines for plan administration, fiduciary duties, reporting and disclosure requirements, and provides a framework for ensuring the financial security of employees' retirement savings.
By understanding the impact of ERISA on 401(k) plans, both employers and participants can make informed decisions and take advantage of the protections and benefits afforded by this important legislation. A retirement plan is meant to provide a benefit to employees and help secure their financial future. When ERISA guidelines are viewed through the lens of helping to protect the employees and their benefits, their need becomes much easier to understand.
An employer-sponsored 401(k) is one of the most popular retirement savings vehicles in America, but just having one doesn’t guarantee a fruitful retirement. While many individuals rely on 401(k) plans to secure their future, making the right decisions with your investments can mean the difference between a comfortable retirement versus having to work longer than one would like.
Having a knowledgeable and trustworthy advisor who can guide you in making the right decisions can be the key to that difference. There are times when it becomes evident that an advisor is not serving you well as a client and a change in 401(k) advisors is necessary. In this article, we will discuss several key indicators that can help you identify when it may be time to begin the search to change your 401(k) advisor.
A fiduciary advisor is obligated to act in your best interest, putting your financial well-being ahead of their own. If your advisor does not explicitly acknowledge or fulfill this fiduciary duty, it may be a sign that they are not prioritizing your interests. Transparency and clear communication are essential when it comes to understanding the fiduciary relationship, so if you feel your advisor is not sharing this liability with you, it might be time to explore other options.
An experienced 401(k) advisor should go beyond simply recommending investments. They should also offer guidance on plan design and oversight, ensuring your retirement plan aligns with your goals and needs. If your advisor neglects these crucial aspects and fails to provide valuable input on optimizing your plan's structure and monitoring its performance, it may be an indication that they are not delivering the comprehensive support you require.
As you progress through life, your financial situation is bound to change. Whether it's getting married, starting a family, or nearing retirement, these milestones necessitate adjustments to your retirement strategy. If your advisor fails to recognize and adapt to these changes, continuing to provide the same generic advice without considering your evolving circumstances, it may be a sign that they are not adequately attentive or responsive to your needs.
At a minimum, your investment strategy should be changing as you draw nearer to retirement. In your early years, your portfolio can withstand a slightly higher level of risk (equities), as the market tends to perform in a cyclical nature. As you draw closer to retirement, your portfolio should be moving away from risk and towards safer investments that offer a level of protection against market downturns when you need your savings the most.
If your advisor is not rebalancing your portfolio as you get older, that is a sure sign that you may need to find another advisor who better understands risk mitigation in relation to your retirement horizon.
A robust financial wellness program is an essential component of a comprehensive retirement plan. It encompasses various aspects such as budgeting, debt management, and education on financial literacy. If your current advisor does not offer or actively promote a financial wellness program, it could indicate a lack of commitment to your overall financial health. Consider seeking an advisor who places importance on your holistic financial well-being and education.
A transparent fee structure is crucial for understanding the costs associated with your retirement plan. If your current plan has a convoluted fee structure that is difficult to comprehend and your advisor is not willing to explain it to you clearly, it raises concerns about their transparency and whether they have your best interests at heart. A trustworthy advisor should be forthcoming about all fees and actively address any queries or concerns you may have.
If you discover hidden fees that change the overall costs of your investments as your plan progresses, that may present a red flag that should be addressed. An advisor’s fees may be negotiable, but hidden fees that weren’t previously disclosed may be reason enough to shop for a new advisor.
Investment decisions should be based on careful analysis and alignment with your long-term goals, not on impulsive buy or sell recommendations. If your advisor only contacts you to push certain investments or suggest frequent trades without providing comprehensive explanations or reasoning, it could be a sign that they prioritize their own commission over your financial well-being. A reliable advisor should focus on your overall investment strategy rather than short-term gains.
If this happens often, you could be in a situation in which your advisor is committing a practice called “churning.” This may fall under SEC Rule 15c 1-7, which governs any deceptive or manipulative conduct enacted by a broker. If you feel that your advisor is committing “churning” by overtrading your account to grow commissions, you may file a report with the SEC or FINRA.
Effective communication is crucial for a successful client-advisor relationship. If you find that your advisor consistently fails to listen to your concerns, goals, and preferences, it indicates a lack of attentiveness and understanding. Your advisor should actively engage in conversations, address your questions and doubts, and tailor their recommendations to your unique circumstances.
Trust is the foundation of any professional relationship. If you feel hesitant or fearful to reach out to your financial advisor, it is a significant red flag. Open communication is vital for effective financial planning, and if you are uncomfortable discussing your concerns or seeking clarification, it may be a sign that you should consider finding an advisor with whom you can establish a more trusting and transparent connection.
Some advisors prefer to use complicated financial lingo or explain things in overcomplicated ways to either keep their clients in the dark, beholden to the advisor's decisions, or in some cases purely to stoke their own ego. If your advisor makes you feel apprehensive about speaking with them because of the way they communicate, it isn’t likely to lead to a positive working relationship.
In order to achieve the best possible outcomes from your retirement planning efforts, you and your 401(k) advisor need to be able to work together as a team. If you observe any of the following warning signs, it may be time to reevaluate your relationship with your current advisor and explore other options that align better with your needs and goals:
Making the right choice for your financial future is essential, and finding the right advisor is a crucial step toward achieving your retirement aspirations. If you find that any of the warning signs outlined above are present within your current 401(k) advisor, it may be time to find a new one.
Planning for your retirement is one aspect of life in which time is extremely important, as you have a finite amount of it in which to save enough money to last through your Golden Years. If you feel for any reason that your 401(k) advisor does not have you on the right path toward your retirement, it’s time to find one who will guide you in the right direction.
If you are an employer who offers a 401(k) retirement plan for your employees, working with the right advisor is crucial to the plan’s success. There may come a time when it becomes necessary to change the advisor who manages your plan, for any number of reasons. Once an employer has identified the need for a change of advisors, how do they go about doing so?
This article will provide readers with guidance on how an employer can change their 401(k) advisor, by outlining the following:
We hope that you never encounter the need to change your 401(k) plan’s advisor, but this article will help you understand the process should that need arise.
There are several reasons why an employer might consider changing their 401(k) advisor:
When considering changing your 401(k) advisor, you should begin by exploring your options and assessing the market. By knowing what other advisors offer, you can make an informed decision and potentially find a better fit for your plan and participants' needs.
When comparing advisors, consider factors such as:
Knowing the other options that are available may give you the room to negotiate with your current advisor if fees are the main point of contention. If there are other issues at play, doing your due diligence will help you make an informed decision based on the needs unique to your company and plan.
Before making any changes, it's important to benchmark your existing 401(k) advisor and plan against industry standards. You should evaluate the key metrics of your plan such as investment performance, fees, participation rates, and employee satisfaction. This benchmarking process will help you identify areas where improvements can be made and provide a baseline for comparing potential new advisors.
If the cost-efficiency of your plan is the issue, compare the fees charged by your current advisor with industry averages for similarly-sized plans to see if they are reasonable. Assess the transparency of fees and consider whether alternative fee structures, such as flat fees or fee-for-service models, would better suit your plan's participants and needs.
Evaluate the performance of your current 401(k) plan's investment options. Compare their returns to relevant market benchmarks and industry standards. Look for consistent performance over the long term and consider whether your current advisor has the expertise and resources to provide superior investment options.
If the overall market is in a down cycle in which investments are performing poorly across the spectrum, changing your plan advisor may not result in positive outcomes. If the funds offered by your plan are performing more poorly than the rest of the market, however, a change may be what is needed.
The quality of service provided by your 401(k) advisor is crucial for plan success. Evaluate the accessibility and responsiveness of your current advisor, their ability to address participant inquiries, and the level of educational resources that they provide for your plan participants.
Consider whether your plan requires additional services, such as financial wellness programs or personalized participant guidance, and assess whether potential new advisors can fulfill those needs. Advisors will often put a lot of effort into gaining new clients, so this may be an area where you can make providing the needed resources a determinant of their winning your business.
Once you have thoroughly evaluated your current advisor and explored outside options, you may come to the decision that it is time to change your 401(k) advisor. Follow these steps to facilitate a smooth transition:
When changing your 401(k) advisor, it's important to consider the following aspects:
Changing your 401(k) advisor is a major decision that should be driven by the best interests of your plan participants. Before making the determination to change your advisor, you should take the time to assess your current plan’s performance, fees, and the level of service provided by your current advisor. Compare them to industry benchmarks to verify that better options may be available for your employees.
You should take the time to explore alternative options, conduct due diligence on potential new advisors, and consider factors such as fiduciary responsibilities, investments, service levels, participant access, cybersecurity, and fees. Don’t rush the process and switch to the first advisor that you find, as you want to find the best available option for the benefit of your plan participants.
By thoroughly evaluating your options and following a well-planned transition process, you can make a smooth switch to a new 401(k) advisor that better aligns with your plan's goals and enhances participant outcomes. A 401(k) plan is a benefit to your employees, so put in the effort to make it the most beneficial to their retirement outcomes possible by finding the right advisor to manage it.
The Certified Financial Planner (CFP) designation is one of the most widely recognized in the finance industry, and indicates a high level of competence, education, and knowledge within numerous aspects of money and investment management. But what is Certified Financial Planner?
This article will provide comprehensive insights into Certified Financial Planners, their roles, fiduciary duty, the potential costs of hiring one, fee structures, finding a CFP, the certification process, and the CFP exam. If you feel that a Certified Financial Planner is right for your financial needs, we will also outline how to find the right one for you.
A Certified Financial Planner (CFP) is a financial professional who has obtained the CFP certification, a widely recognized and highly regarded standard in the financial planning industry. CFPs have undergone rigorous training, education, and examinations to demonstrate their competence in various areas of financial planning.
A CFP provides comprehensive financial planning services to individuals, families, and businesses. They analyze clients' financial situations, can help to create budgets and set financial goals, and devise strategies to achieve them.
CFPs offer expertise in areas such as investment management, retirement planning, tax planning, estate planning, insurance analysis, and risk management. They provide personalized advice that is tailored to clients' unique circumstances and goals.
CFPs are held to a fiduciary duty, meaning they are legally obligated to act in the best interest of their clients. This fiduciary standard means that CFPs have to prioritize clients' interests over their own and provide advice that is free from conflicts of interest. While this may seem like something that all financial advisors would be bound by, non-fiduciaries are not always obligated to follow this standard.
Working with a CFP who follows the fiduciary standard can provide peace of mind, as it ensures that their recommendations are solely based on the client's best interests rather than outside financial considerations.
The cost of hiring a CFP can vary depending on several factors, such as the complexity of the client's financial situation, the scope of services required, and the CFP's level of experience.
CFPs may charge fees based on a percentage of Assets Under Management (AUM), an hourly rate, a flat fee, or a combination of these approaches. It is essential to have a clear understanding of the fee structure and any potential additional costs before engaging in the services of a CFP. Some advisors may also be willing to negotiate their fee structure, especially for a long-term working relationship.
There is an important difference between fee-only and fee-based advisors that should be understood when considering hiring a CFP:
Finding a CFP involves careful consideration and research to find the right one for your unique needs. Some effective ways to find the right CFP for you include:
To become a Certified Financial Planner, individuals must fulfill several requirements:
The final step in becoming a Certified Financial Planner is passing the CFP exam. This comprehensive exam evaluates a candidate's knowledge and understanding of financial planning concepts, principles, and practices. The exam covers various topics, including financial planning, tax planning, retirement planning, estate planning, investment management, and ethics.
Candidates must demonstrate proficiency in all areas to earn the CFP certification. If you are considering attaining a CFP designation, be aware that it is known as one of the more comprehensive and difficult examinations within the financial industry.
Certified Financial Planners (CFPs) are professionals who possess specialized knowledge and expertise in financial planning. They provide comprehensive advice and guidance to clients, helping them achieve their financial goals. Those clients may be individuals, families, or businesses, as the CFP designation denotes a comprehensive understanding of many different aspects of finance, financial planning, taxes, investments, and money management.
Working with a CFP who adheres to the fiduciary standard ensures that their recommendations are made solely in the client's best interest. When hiring a CFP, it's important to understand the associated costs and fee structures, and that there is a difference between one who is fee-based versus fee-only.
Adding the benefit of a 401(k) plan for your employees can do wonders for morale and retention, but simply setting up a plan isn’t all that is required. The landscape of retirement planning and investment options is constantly evolving, making it crucial to stay informed and ensure that your 401(k) plan is optimized. To be assured that the plan and 401(k) plan advisor are providing the best possible outcomes for participants, employers should routinely conduct a 401(k) plan review.
Regularly reviewing your 401(k) advisor’s diligence is essential for the success of your retirement plan and the financial well-being of your employees. This article will explore the importance of annually reviewing 401(k) advisors, focusing on the key areas to monitor such as plan participation rates, deferral rates, investment diversification, and employee participation based on compensation.
Annual reviews of your 401(k) advisors are crucial for several reasons:
One important aspect to evaluate during your annual review is your plan's participation rate. This measures the percentage of eligible employees who are actively contributing to the 401(k) plan. A low participation rate may indicate a lack of employee engagement, awareness of the plan's benefits, their view of the plan, or whether the 401(k) advisor is providing them with enough education regarding their ability to save for retirement.
If your plan's participation rate is low, consider taking the following actions:
In addition to participation rates, it is essential to review your plan's deferral rates. Deferral rates refer to the percentage of an employee's salary that they contribute to their 401(k) account. Low deferral rates may indicate a need for additional education or encouragement to save more for retirement.
Investment diversification is a critical aspect of a well-designed 401(k) plan. During your annual review, assess the diversification and performance of the investment options offered to participants. Consider the following:
During your annual review, assess the participation rates of highly compensated employees (HCEs) versus non-highly compensated employees (NHCEs). Ensure that the plan does not discriminate in favor of HCEs, as this can lead to compliance issues.
To address any disparities:
As an employer, conducting an annual review of your 401(k) advisors is crucial for maintaining a successful retirement plan. In doing so, you should evaluate the plan’s participation rates, deferral rates, investment diversification, and employee participation based on compensation. It can be helpful to identify areas for potential improvement, implement strategies to enhance participation, and stay on top of keeping the plan’s performance optimized.
Regular reviews ensure compliance, participant satisfaction, and the ability to adapt to changing market conditions, ultimately helping employees achieve their retirement goals. A good 401(k) plan can provide benefits for both the employer and employees. Performing an annual 401(K) plan review can ensure that the plan and its advisor are providing the best possible outcomes to the plan participants.
When structured and implemented well, a 401(k) plan can be an important component of an employee's financial well-being and state of mind. Selecting an advisor for your company’s 401(k) plan is an important first step to building a plan, as they will play a crucial role in its creation, implementation, and administration. The right plan can help to secure your employees’ financial futures, improve employee morale, and help attract and retain top talent to and in your company.
A trusted advisor fosters employee confidence, which in turn can help to maximize engagement. No matter how good of a 401(k) plan you create, it’s not helping anyone if it isn’t being used. This is just one of the many reasons we will outline below for why choosing the right 401(k) advisor is critical to delivering this benefit to your employees.
The needs of most small and medium-sized businesses are different. This makes it imperative that employers choose a competent advisor who can assist in designing and implementing a 401(k) plan that aligns with your company's specific goals and needs. The right advisor should provide guidance on plan design options, investment choices, and other critical factors to ensure the plan is well-suited for your employees' needs.
Furthermore, a good 401(k) advisor can educate both employers and employees about the plan's features, benefits, and contribution options. This can be done through in-person seminars at your company, informational literature outlining the plan, or simply helping you to be prepared for questions that your employees may have.
This educational support helps employees understand the importance of saving for retirement and empowers them to make informed decisions regarding their financial future. Perhaps most importantly, it educates them about their options and gives them control over securing their retirement goals.
A poorly designed 401(k) plan may result in limited investment options, high fees, and inadequate support services. This can negatively impact employee participation, engagement, and overall retirement outcomes. As noted above, a 401(k) plan that isn’t used doesn’t do any good for anyone, so it’s worth making the effort to ensure the plan is beneficial to all.
In addition, a subpar 401(k) plan can expose employers to legal and regulatory risks. Failing to comply with the complex laws and regulations from the IRS and ERISA governing retirement plans can lead to costly penalties and potentially even lawsuits.
401(k) providers typically fulfill three primary functions: the advisor, the custodian, and the record keeper. Each role outlined below must work together to ensure the successful implementation and operation of a 401(k) plan:
When evaluating 401(k) advisors, it is crucial to consider their history of adherence to the fiduciary standard, which means that they are legally obligated to act in the best interest of their clients. This standard ensures that advisors prioritize the welfare of plan participants, and minimizes conflicts of interest that could compromise the plan's success.
In contrast, advisors following the suitability standard are only required to recommend suitable investments, even if they may not be the best option for participants. Employers should prioritize working with fiduciary advisors to provide the highest level of protection for their employees and mitigate potential legal risks.
Choosing a 401(k) plan provider involves evaluating various factors to ensure they align with your company's needs and priorities. The following key aspects should be considered when assessing potential providers:
In addition to assessing the plan provider, you should also take care to evaluate your advisor's qualifications. Consider the following aspects to ensure your advisor is well-equipped to provide quality guidance:
An employer should also consider the financial advisor’s fees when selecting a 401(k) advisor. Different fee structures exist, and some will cost more than others. Some examples of advisor-related fee structures are based on the percentage of Assets Under Management (AUM), hourly fees, or flat fees.
Consider the following aspects related to financial advisor fees:
If you are concerned about financial advisor fees, there are several strategies to consider:
Implementing a 401(k) plan for your company can help to boost morale, attract & retain top talent, and allow your employees to focus on work rather than worrying about their financial future. Selecting the right 401(k) advisor is crucial for both employers and employees, as they will play a major role in the plan’s design and administration.
By considering the importance of a competent advisor, the risks associated with a poor 401(k) plan, and evaluating the functions of 401(k) providers, employers can make informed decisions to protect their plan and employees. From the outset, creating a plan for your company may seem like a monumental task, but the right 401(k) advisor will help shoulder much of the burden and keep the plan on track.
Choosing the right 401(k) advisor for your needs can make the process both efficient and effective, so it’s imperative to do your due diligence based on the information provided above.
In the era of big data, information - even the seemingly mundane - has more value now than it may ever have had before. Living in modern society and interacting with the internet has given most people a first-hand window into just how many data points we each leave behind in our wake and how those histories can be collected, analyzed, and used in a predictive capacity - sometimes with unsettlingly accurate results.
In the business world, collecting as much data about customers as is feasible has become standard operating procedure in many industries. Likewise, collecting operational data including employee performance metrics in support of process improvement and streamlining has become similarly commonplace, as well.
Oftentimes, however, data that is collected from a given source becomes somewhat siloed and is only considered or put to use in the context of the source from which it came. For example, operational data being used exclusively in operational analysis.
Along those lines, many companies have a substantial amount of data available to them at this point many with regard to employee benefits package choices and usage that they have collected over time through various platforms, applications, websites, and benefits providers. With this data, companies typically then refine benefits offerings on an ongoing basis to best meet employee needs and implement benefits strategy as it evolves.
In limiting employee benefits data to employee benefits analyses, however, companies are potentially missing a major opportunity to put that data to work in a number of other ways that can help the company achieve goals well beyond the scope of employee benefits optimization.
Through benefits-related data analysis, companies can get a more complete picture of their employee pool - as a whole and as individuals - including demographic data and benefit utilization, of course. With regard to benefit utilization, if the data reveals an especially popular voluntary benefit among employees, the employer might choose to fund that particular option, for example. Beyond the benefits context, the same data might reveal employee content engagement patterns and preferences that can help shape future intra-company messaging and communication strategies, both about benefits and other topics as well.
Similarly, an analysis of take-up rates with regard to a given benefit can help employers locate employee engagement gaps. If employees have a low-engagement rate for a particular benefit, that benefit is probably not particularly popular with employees and should be addressed by benefits managers as an isolated issue. If the engagement is more widespread across the benefits package and/or employee population, then the problem is likely more foundational and must be remedied through a larger overhaul including improved communication and education for employees about benefit value. Further, understanding the means through which engagement gaps were bridged with a given employee can potentially be useful in bolstering engagement outside of the benefits context, as well.
Analyzing benefits data can also serve as a detection system that can help employers identify employees who are experiencing financial distress and intervene before the situation worsens to the point that it becomes a bigger problem for both the employee and their employer. One of the first signs of an employee having difficulty making ends meet is their opting out of benefits, especially en masse. By setting up alerts for certain benefit-dropping behavior, employers may be able to discover employees who are struggling and offer them support at a time when they need it most.
Ultimately, by utilizing the data that can be mined from employee benefits platforms, employers have an opportunity not only to improve their benefits packages and the offerings within to better meet their objectives on a near continuous basis, they can also put that very same data to work improving other aspects of their business at the same time - which is a lesson about data that applies well beyond benefit-related data, as well.
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