Counties help employees prepare for retirement

Nationwide recently announced that Eric Stevenson will be the next leader of Nationwide’s retirement plan business. Stevenson steps into the role succeeding John Carter, who was recently named president and chief operating officer-elect over all of Nationwide’s financial services business lines.

Stevenson most recently served as senior vice president of distribution for Nationwide’s retirement plan business, which is responsible for nearly $145 billion in assets under management for more than 2.5 million participants.

The National Association of Counties (NACo), in partnership with Nationwide Retirement Solutions (NRS), and state associations of counties, provides county employees with a Section 457 Deferred Compensation Program. Since its inception in 1980, NACo's Deferred Compensation Program has grown to become the largest supplemental retirement income program available to county employees. More than 380,000 county employees from more than 3,100 county agencies currently participate in the Program, with accumulated assets of more than $19.2 billion.

“Our experience serving small and medium-sized businesses and public sector plans for state, city and county employees, as well as first responders, puts Nationwide at an advantage to best understand the unique needs of plan sponsors and their participants,” Stevenson said.

County News asked about Nationwide’s vision for county employees’ retirement readiness and how counties can attract and retain talent through robust benefits packages.

Q: How can counties help prepare their employees for retirement?

A: Identifying a trusted retirement plans provider, and one whose values align with yours, is the first step. Nationwide is committed to helping drive retirement readiness by engaging with our county partners and their employees on an ongoing basis. From attending new employee orientations to coordinating workshops and being available for personal consultations on-site, we partner to help educate employees on the benefits and make it easier for them to start saving.

Q: What is the best way for a county employee to assess whether they are on track for retirement savings?

A: Take advantage of the tools your retirement plan provider offers to ensure you’re tracking against your goals. For example, Nationwide’s My Interactive Retirement Planner calculates how much participants may need and allows them to model different retirement scenarios. Additionally, they can generate a Retirement Readiness Report to have a conversation with their Retirement Specialist or advisor to explore other savings solutions to help them meet their goals.

Q: What should employees do to maximize their savings?

A: Employees should contribute what they feel comfortable to their 457 plan and then meet with their Retirement Specialist or advisor on an annual basis to review their account and discuss options to help maximize their retirement readiness. They can also take action through a Participant Engagement Program if one is offered. Nationwide has found that employees who engage in our program increase contributions by approximately 22 percent. (Participant Engagement Program results from April 2017 to October 2018)

Q: What is the biggest mistake people make with their retirement accounts?

A: Waiting. According to a Nationwide study, we found that on average, employees start saving for retirement at age 31. Time is your biggest ally when it comes to saving for retirement, but many workers put off contributing to their retirement savings because they feel obligated to commit their income toward more immediate needs like paying off student loan debt or saving up for a down payment on a house. But the truth is, retirement savings doesn’t have to be all or nothing. Even a little bit can go a long way down the road. (Nationwide Participant Solutions Research Study, 2017)

Q: What should counties do to ensure employees are taking full advantage of their retirement accounts?

A: There are a couple things we recommend to Nationwide’s plan sponsor partners in the public sector. First, we encourage them to meet with their local Program Director to establish an annual education and marketing plan that’s designed to reach employees and drive up participation and savings. The second recommendation we give is to use our online Plan Health Dashboard, which provides a comprehensive view of the retirement readiness of all their plan participants.

Q: When recruiting new employees, what should counties highlight about their pension plan/457 to attract good candidates?

A: A 457 plan is a great way for people to save for retirement on a pre-tax basis. Beyond defined contribution plans, Nationwide is always looking at additional ways to help workers with their financial wellness. For instance, if a county offers a Health Savings Account, this is another tax-advantaged tool employees can leverage to save for healthcare costs in retirement that would free up their 457 funds for other living expenses.

Q: Are all retirement plans the same?

A: 457 plans may look similar, but the level of engagement a county has with the plan provider is what sets things apart. We find the more a county collaborates with us and enables us to come in and support educational and marketing efforts, the better results we see from a participation and savings standpoint.