Some people dream of their retirement days – what they are going to do, where they want to be, all sorts of ideas above and beyond resting are included in those plans. Other people feel they are never going to be able to afford to retire and don’t see any of those golden dreams when they shut their eyes at the end of a long work day. A lot of their beliefs can be shaped by retirement savings.
Sometimes it’s easy for an employer to look into the eyes of their employees to see in which camp each worker falls. And, more often than not, the small business owner wants to help their employees be financially secure and looking forward to their days ahead. But not every employer can afford to contribute to a pension savings plan for their employees.
However, that does not mean they cannot encourage their employees to set aside money in savings. The Employee Benefit Research Institute recently issued the 2017 Retirement Confidence Survey results. Their experts have been compiling this data for 27 years so there is substantial credibility to their findings.
A few of their findings:
- Six out of 10 American workers feel very or somewhat confident about having enough money for a comfortable retirement
- Three in 10 workers report that preparing for retirement causes them to feel mentally or emotionally stressed.
- Another 3 in 10 workers say that they worry about their personal finances while at work (30%).
But, of significance importance to small business owners, more than half of these worker believe they would be more productive at work if they didn’t spend time worrying.
There isn’t a small business owner who wouldn’t like more productivity – and a happier set of employees in their workplace.
So what can a small business owner do?
While it is a majority, it is only a slight one, about 61% of workers report having saved any money for retirement. And only about 56% say they are saving now. The report goes on to say that “nearly 3 in 4 workers (73%) not currently saving for retirement say they would be at least somewhat likely to save for retirement if contributions are matched by their employer.”
Contributing to an employee plan might not be in your budget right now, but don’t give up trying to help your employees. There are other options.
According to the survey results,
“approximately two-thirds of non-saving workers (68%) say they would be likely to save for retirement if automatic paycheck deduction with the option of changing or stopping them, at either 3% or 6% of salary, were used by their employer.”
That means that simply providing the opportunity for a payroll deduction to go directly into a savings account could change the retirement plans for a small business owner’s valued employees, even if the owner cannot contribute to it.
With a payroll service like The Payroll Department, managing a program of that nature would be easy. Outsourcing to us means that you just have to offer the benefit, and we take care of all the mechanics of it for you.
In addition, offering the services of a financial planner is another opportunity for small business owners to increase the financial security of their employees. Working with a professional financial planner, employees gain several benefits:
- Advice and recommendations on how to grow their investments and savings
- Planning for large expenditures like purchasing a home or college or other educational expenses
- The opportunity to develop a formal financial plan for retirement
- Information about how to cover medical and long-term care expenses
An employer can provide opportunity as well as employment for the future benefit of their employees. We see it work wonders for families every pay day here at The Payroll Department. Lifting up a family can be as important as wage increases and more work hours.
Contact us here at The Payroll Department to how to encourage your employees to lead richer lives with payroll deductions.