Why most 401k presentations miss the mark!

It’s that time again. Time to corral as many people as possible into a conference room to listen to this Quarter’s 401k presentation. It’s time to explain a Summary Plan Description, Contribution Limits, Beneficiaries, Distributions, Company match and my favorite Rollovers. Heavy naps!!!
Companies do a very good job of understanding what their customers want so they gear their marketing to answering the Why questions first and then the How.
But when it comes to explaining things like a 401k plans to their employees companies go right for the “How” and forgets the “Why” because the company usually invites the 401k provider or administrator to give the presentation. So it becomes a technical, legal and heavily financial investment “How” presentation totally ignoring the “Why” reasons except for, wait for it, “you’ll need it for retirement”.
Retirement?? Who cares about that? That’s for old people far in the future. I need to pay my mortgage, payoff my student loans, save for my kids college education and finally pay for our next family vacation. All very good “Why” reasons and very little “How”. That’s the problem! We tend to think about 401k presentations as a duty bound lecture of “How it works” and not “Why” you need to put it into your “A” list of priorities.
The simple fact is most of these presentations dwell on the technical side of the equation (How) and ignores the human side (Why) of what actually happens when either your health fails or your presence is no longer needed with the company at 65.
What every 401k presentation needs is the 401k administrator to tell the assembled all about the “How” but equally important they need a Retirement Lifestyle Coach there to tell them “Why” they need to invest now for their future. They need to know that once they leave corporate life, if they have not planned psychologically and financially for that next phase of life, it may become the most terrifying time of their lives rather than the most joyful.
Why most 401k presentations miss the mark!
Today retirement is not a time to go sit on a beach all day, or play golf incessantly or travel the world without end. Hopefully retirement today is not an end but a transition to a new beginning where you focus on the things I want to do rather than have to do.
You choose to continue to work because it is your passion not because it’s all you know and I need the money. You choose to volunteer locally at a not for profit because you feel they make a difference and you want to be part of it. You choose to downsize your living space so you are not captive to all the costs of the big house. You choose to take those occasional trips to those places you’ve always wanted to go to. You choose to check off everything on your bucket list while you still can.
Yes, that is the way you want to spend the last 20 or 30 years of your life. You want to spend it joyfully free of regrets and fear. Here are some real “Why” statistics when it comes to saving for what’s next. The average age of retirement today is 62 and the average life span of a retiree is 84 with many living well into their 90’s. Today only 25% of Boomers believe they will have enough money in retirement, and only 28% believe they are doing a good job financially in preparing for retirement according to a 2018 study by the Insured Retirement Institute. Very sobering!
You see in this next phase of your life you need to switch from collecting wealth to taking care of your health. Why? Because you can’t take your wealth with you when you leave this world and if you are not healthy you can’t enjoy your life as you envisioned it. “Why” Because without good health this part of your life can become rather dark where you go from depressed to disabled to six feet under.
This is “Why” you need to put your 401k plan on your “A List” and this is “Why” your company needs to invite a Retirement Coach to share with all of you what actually happens in your next phase of life so that your retirement plan does not become I will simply die at my desk…

Bob Foley is a Certified Professional Retirement Coach by the Retirement Coaches Association who also happens to be in semi-retirement after several years in corporate life as an HR professional and a CEO. Visit his website at www.legacytransitions.org or see his LinkedIn profile or finally email him at bob@leagcytranstions.org