Courageous Plan Design - Sapers & Wallack

Courageous plan Design Readying Employees for Retirement Through Bold LeadershipCourageous plan Design : Readying Employees for Retirement Through Bold Leadership 2 Begin SavingSteps To Not SaveEnrollReview Investments OptionsChoose Salary Deferral RateSelect Allocation MixAnnually Increase Save or Save IntroductionEnormous resources are going toward encouraging employees to participate in their employer s 401(k) plan . After all, if the benefits are made clear and it s easy to enroll, who wouldn t take full advantage? Yet three decades after the 401(k) s debut, employees still contribute too little to their plan or not at all, leaving them ill-prepared for retirement. Why?The problem isn t education, access or, as some claim, a broken system. It s, in a word, inertia. Employees struggle to act in their own best interests even when they know it could improve their financial future. That s why employers need to ensure that it takes less effort to succeed at saving for retirement than to fail.

Courageous plan design raises the bar to a 2 percent increase per year, thus reducing the time it takes for participants to reach higher contribution rates. It is also recommended to not cap the increase at 10 percent, effectively allowing

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