Employer provided financial education helps employees better plan for the future

While few companies offer their employees company-based pension plans, progressively more business are providing financial planning opportunities as an incentive to help retain workers.

Elizabeth Olson, A Few Lessons on Saving, Courtesy of Employers, NYTimes.com, Oct. 23, 2007 reports:

Rinker, an engineering company in Manassas, Va., hired Principal Financial Group two years ago to hold financial planning seminars periodically for its 100 employees, and personal sessions for those who wanted to take a deeper dive into retirement planning.* * *

In March, I.B.M. unveiled a $50 million personal finance and education benefit program for its 127,000 workers in the United States. Earlier, the company had said it would end contributions to its pension plan but expand its 401(k) retirement plan benefits.***

However, many workers are not taking full advantage of the 401(k) plans offered by their employers: * * *

A 2006 survey of 1,000 company plans by the Profit Sharing/401k Council of America found that 77.7 percent of eligible workers participated in 401(k) plans. But lower-paid employees contributed much less than their higher-paid colleagues — 5.4 percent of their income, compared with 6.9 percent. * * *

Some employees have increased their 401(k) contributions after meeting with a financial advisor.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.