Trends toward both living and working longer are shifting how employees and employers have traditionally thought about financing retirement. Flexible hours and flexible benefits are becoming ever more important, and offering these benefits gives employers an edge with the only age group in the workplace slated for growth.
Cost Vs Resource
The archetype for reaching 65 has generally been retiring and sailing off into the sunset, far away from the office, and supported by an amply stocked retirement account. Those who have chosen to stick around longer have not always been welcome, with older workers deemed more of a cost, than a benefit. Times are changing, however: an AARP analysis of data from the Bureau of Labor Statistics revealed this bottom line for businesses: “The only segment of the workforce by age that is growing over the next decade is workers who are 75 and older….” Further evidence of older employees remaining active in the workforce comes from Pew Charitable Trusts, which points out: “Currently 62% of workers 65 and older are working full-time, compared to 47% in 1987.”
As competing for older employees, who are educated and want to work, becomes more necessary for businesses, shifts in traditional thinking about benefits packages can make all the difference, so plan sponsors “probably need to start demanding from their product manufacturers new content [for] thinking about longevity [planning] not simply retirement planning…”. Win-win arrangements for employers and older workers might start to look like this:
Employers that want to recruit and retain older workers, many of whom may want to work less than full-time or may be willing to accept lower compensation, may need to consider offering more benefits to part-time employees, providing flexible work hours and appealing to older workers by trading off slightly lower compensation for enhanced benefits….“For instance, the older worker might be looking less for cash income and maybe more for benefits….[Plan sponsors may] make a trade off saying, ‘hey, we got you covered for dental or we got you covered for additional medical but that’s going to be a little less cash in your pocket’ and [older workers] may be good with that because they’ve just retired [from full-time employment], perhaps with a full 401(k) or pension plan.”
Time To Lean In?
As plan sponsors grapple with a host of trends impacting the workplace, it’s important to remember that no matter what the “final, final ” version of the DOL’s update to the fiduciary rule ends up including, heightened scrutiny is likely–and indeed already upon us, given increases in both regulations and litigation. Protection is a best practice and
at Colonial, a whole year of Fiduciary Liability coverage is less than a few dollars a day, with Cyber Liability included to further protect the business and retirement plan.Armed with Colonial’s liability coverage, if you face claims of alleged or actual breaches of duty in connection with the employee retirement plan, you’ll be protected with defense costs and penalty limits up to $1,000,000.
Colonial offers a simple and affordable way to protect yourself and your business: just opt in below to upgrade your ERISA bond to include Fiduciary Liability insurance. You’ll even receive Cyber Liability insurance at no extra cost. You can choose a 1, 2, or 3-year package.
If you already have an ERISA bond package with Colonial, you can even lock in your rates by upgrading to the 2 or 3 year package.
Protect yourself, your business and your plan for the go forward:
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