Busy women fall short in retirement readiness

busywomenI have the great pleasure of working with investment and retirement committees day in and day out that tackle the tough task of managing a retirement plan that will, more than likely, be a main source of retirement income for their valued employees in the future. In most every case, these committees have at least one female who is at the table helping shape the future for her people at work. As a woman, I know that it is second nature to want to take care of other people first; sometimes out of necessity and other times because taking care of other people’s problems allows us the ability to push our own problems further down the line. However, when it comes to preparing for our own retirement futures, putting our own needs at the bottom of the pile can be a big mistake. The fact of the matter is that in households today women make the financial decisions. Need proof? Women make 85 percent of all brand purchases (Stephanie Holland, shecomony) and according to Nielson Consumer 04-02-2013, women’s purchasing power ranges anywhere from $5 trillion to $15 trillion annually. So why are we still delaying putting a plan together for how we are going to live and spend in retirement?   If you would like to discuss how becoming more financially prepared for the future can help you today, please let me know.

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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What is keeping your employees awake at night?

shutterstock_171835172A recent survey finds that 62% of Americans are losing sleep over at least one financial problem, and the most common worry? Retirement savings.

According to a 2015 CreditCards.com report, people are up counting sheep at night concerned about some serious money issues.

  • The most common money fret is saving enough for retirement; two in five Americans say this keeps them up at night at least occasionally. People between the ages of 50 and 64 are the most concerned (50% said they fret about their retirement savings – or lack thereof – in the wee hours).
  • The second-biggest concern is educational expenses. This time, it’s younger adults who are the most troubled. 50% of 18-29 year-olds are losing sleep worrying about how they’re going to pay for educational expenses (much higher than the 31% of the overall population who have this fear). Student loan repayment is a sincere, honest concern for young Americans. Trent Grinkmeyer had a great article recently for parents of young children with ways to save for their college education. It seems as if more parents had saved and prepared 20-25 years ago, there would be a lot more people sleeping well tonight.
  • 29% of Americans are losing sleep because of healthcare/insurance bills, 27% because of their ability to pay the monthly mortgage/rent and 21% because of credit card debt.One thing that all of these concerns have in common is that they can be solved, or at least lessened, with proper planning. Working with a qualified financial advisor to assist your people with financial topics such as budgeting, debt reduction, and retirement readiness, can make the difference between a well-rested, alert workforce and groggy, stressed-out employee population.

 

Source: http://401kspecialistmag.com/401ks-as-a-sleep-aid-retirement-savings-keeping-clients-up-at-night/

 

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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Friday Funny {May 5, 2016}

Bk0X2xhCIAAlT8AThis week’s Friday Funny isn’t as funny as it is true.

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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You cannot spell HERO without HR

hr2.jpgIt is not often when I am really caught off guard by a remark, but recently while attending a panel style discussion lead by three Human Resource Managers that also serve as 401(k) Plan Sponsors, one of them made a comment that threw me for a loop. She said, “People don’t realize what a lonely job being a Human Resource Manager can be.” She went on to elaborate on the fact that few, if any, members of a company can really appreciate all that the HR professional has to do throughout the day. The rest of the panel members agreed and listed off a myriad of tasks from personnel manager to staffing firm to marriage counselor that most members of human resources serve as besides their official written job description. In an effort to bring others into your personal world or to at least garner a better appreciation for what you do, here are a few much easier said than done ideas for HR professionals.

  1. Find a sidekick– The HR workforce is full of superheroes; and superheroes never need for help, right? Wrong! We all know that Batman had Robin and Wonder Woman had Wonder Girl. Therefore, it is so important that you finds an individual either within the organization or outside to assist with the tasks that you are too busy to tackle to help you free up some time to continue saving the world (or at least your company). Look to your advisers and product providers for resources that they can provide to help you do your best work.
  2. Ask for help – One of the hallmarks of an awesome HR professional is the level of care and selfness that they often exhibit; often to the point that they do not want to appear overwhelmed for the fear that they might burden another employee. However, by not asking anyone for help, you may be creating unnecessary work and/or stress for yourself down the line. Asking for help can also be a great way to involve those valued individuals who report to you by allowing them some extra responsibility.
  3. Delegate more – Delegating is the hardest task for me personally, since I like many hard-working professionals, think my way is often the best way. Recently though I have come to the realization that done beats perfect every time and my way isn’t necessarily the only way. While it is extremely important that tasks get done to your standards, it is also important that items that you do not love to do or are too busy to complete get done as well. Figure out the items that you can let go to free up time to do what you do best.
  4. Say “No” – While you may not be able to say no to the employee standing at your door or your boss demanding an immediate response to an email, there are ways to say little no’s throughout the day. Thinking of saying no to things like checking Facebook every 15 minutes or sitting in on a weekly meeting that does not impact the way you do business as a way to free up time. Also, consider turning your email off for an hour a day as a way to focus on completing outstanding projects. If you are one of those HR superheroes who feels like they could use a sidekick, I would love to talk to you about ways to find advocates and to ask for assistance. As a HR professional, you do so much for your company; isn’t it time for someone to help you?

 

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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CPA Value to Their Clients

value.jpgWhile you are in the midst of finishing personal tax returns, filing extensions, viewing recordkeeper’s reports, sorting through transaction ledgers amongst countless other tasks associated with the normal course of your business, it may be tough to fathom stopping to ask yourself “What other value could I be adding to my clients?” So I have done that for you! Here are a few ideas that you can immediately add to your practice that could add additional value to your client relationships.

  1. Nonqualified Deferred Compensation Plan – If you are a CPA who works with high net worth individuals or business owners, simply mentioning the idea of a Nonqualified Deferred Compensation (NQDC) plan may be enough to spark your client’s interest. A NQDC plan is a type of savings plan that a business sets up that allows a select group of individuals to put away sums of money over and above what a traditional retirement plan allows. There are several forms of investments that a NQDC can utilize, including mutual funds and corporate owner life insurance, and you must have a plan document in place. However, as the name states because the plan is nonqualified there are not the same restrictions to contributions or participation and there is no annual compliance testing associated with this type of plan. It should be noted that NQDC plans are suitable only for regular (C) corporations. In S corporations or unincorporated entities (partnerships or proprietorships), business owners generally can’t defer taxes on their shares of business income. However, S corporations and unincorporated businesses can adopt NQDC plans for regular employees who have no ownership in the business. There are many more nuisances to a NQDC which we would be happy to help you explore if you have a client who is interested in learning more.
  2. Safe Harbor Features – If you audit a plan that consistently fails testing resulting in the highly compensated employees receiving refunds, it may be time for that plan to explore the options of adding a Safe Harbor feature to their plan design. A Safe Harbor 401(k) plan generally satisfies annual compliance testing. By satisfying annual compliance testing through either an approved matching formula or non-elective formula, the highly compensated employees are no longer at risk of receiving a refund of their deferral dollars.   The stated Safe Harbor match formula is 100% match on the first 3% of elective deferrals and 50% match of the next 2% deferred and the stated non-elective contribution formula is equal to a contribution of 3% of eligible compensation for all eligible employees regardless of participation. In both cases, the participants must be formally notified of the Safe Harbor provision through a notice and the contributions are immediately 100% vested.

  3.  Automatic Enrollment – Another idea that can help that plan who consistently fails compliance testing would be to suggest adding an automatic enrollment feature. In a our best case scenario of automatic enrollment, all eligible employees would be enrolled at 6% with an auto-increase feature up to 10%; but, even adding automatic enrollment at the more widely accepted 3%, the plan is taking steps to not only increase their chances of passing annual compliance testing, but also to help their employees become better prepared for retirement.

As a CPA working side-by-side on a business owner’s personal return or auditing a corporation’s benefit plans, you are in a unique position to provide guidance on areas slightly outside your scope of services that may have a meaningful impact on the retirement success of your client and further cement your already valuable relationship. The information provided on our 3 value-add ideas was brief and there are of course individual circumstances that could affect the appropriateness of the recommendations; therefore, please reach out to me if I can be of any further assistance in explaining.

Jamie Kertis, AIF®, QKA jamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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25 Interesting Facts About Millennials

1abThere were 53.5 million Millennials employed in the United States as of May 2015, and by 2025, this generation will comprise almost 75% of the US workforce. Think about that, in less than 10 years 3 out of 4 people who are working in America will be have born between 1980 and 2001.      How much do you know about this upward rising generation other than their stereotype? Yes, they are adults who still like to play video games.   Yes, they have no idea what a typewriter was used for.   And, yes they are technology-dependent, eco-friendly, hipsters who like music that no other generation can possibly tolerate; but there’s more.

Here are 25 things to think about as you recruit, hire and retain Millennial employees:

  1. Pay ranks first among job factors that matter most to this cohort. Meaningful work is second, positive relationships with co-workers third and flexibility fourth.
  2. 82% of Millennials did not negotiate their salary, either because they were uncomfortable doing so or didn’t realize it was an option.
  3. 37% of Millennials left their first full-time job within two years.
  4. 26% said a better salary would have kept them around longer; 17% would have stayed with a clearer sense of how to advance in the organization.
  5. 63% know someone who had to move back home because of the economy.
  6. Millennials list Google, Apple, Facebook, the US State Department and Disney as their top ideal employers.
  7. 94% enjoy doing work that benefits a cause.
  8. 63% want their employer to contribute to a social cause.
  9. 77% would prefer to do community work with other employees, rather than on their own.
  10. 57% want their organization to provide companywide service days.
  11. 47% had volunteered on their own in the past month.
  12. 75% see themselves as authentic and are not willing to compromise their family and personal values.
  13. $45,000 is the average amount of debt carried by Millennials.
  14. More than 63% of Millennial workers have a bachelor’s degree, but 48% of employed college grads have jobs that don’t require a four-year degree.
  15. 70% have “friended” their colleagues or supervisors on Facebook.
  16. $24,000 is the average cost of replacing a Millennial employee.
  17. 15% of Millennials are already managers.
  18. 56% wouldn’t work for an organization that blocks social media access.
  19. 69% believe it’s unnecessary to work from the office regularly.
  20. 41% have no landline phone access and rely solely on their mobile phone.
  21. 65% of Millennials say losing their phone or computer would have a greater negative impact on their daily routine than losing their car.
  22. 29% of Millennial workers think work meetings to decide on a course of action are very efficient. Compared to 45% of Boomers
  23. 54% want to start a business or already have done so.
  24. 35% have started a side business to augment their income.
  25. 80% of Millennials said they prefer on-the-spot recognition over formal reviews, and feel that this is imperative for their growth and understanding of a job.

1a.jpgThere is a lot of interesting facts here. I think we could use them in all sorts of contexts; think about it all specifically in terms of hiring employees and even more important for retaining them. Employee turnover costs skyrocketing. According to the Center for America Progress, the replacement cost of an employee who earns $30,000 to $50,000 a year is 20% of annual salary for those mid-range positions. So the cost to replace a $40k employee would be $8,000. For higher level employees, the replacement costs skyrockets to 150-200%.   For a $100,000 employee, the cost just to replace him/her can be easily $150,000.

The influence of a strong company culture is a huge factor that results can equate to what Gen Xers and Baby Boomers look at as loyalty.   Millennials can be long-term, engaged employees, but not at 1970, 1990 or even 2010 standards.   It is time to make some changes.   It will cost you too much not to.

Sources:

  • Society for Human Resource Management, The Brookings Institution, Dan Schawbel

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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What is Your Millennial Employee Retention Strategy?

turnoverDoes your company have a millennial retention strategy? The rapidly growing millennial workforce is changing ideas of loyalty and employee retention in the workforce. According to the The Deloitte Millennial Survey 2016, two-thirds of Millennials express a desire to leave their organizations by 2020. Businesses must adjust how they nurture loyalty among Millennials or risk losing a large percentage of their workforces. Since most young professionals choose organizations that share their personal values, it’s not too late for employers to overcome this “loyalty challenge”. Companies that approach employee retention in the same way that they did even five years ago may lose their most valuable young talent; as our Employee Education Specialist, Caleb Bagwell wrote about just last week, the cost of replacing employees is high.

Here are 4 job drivers to implement into your company’s culture to influence Millennials in the workplace and how you can translate those concepts into effective employee retention programs.

Recognizing Generational Differences

Generational differences in the workplace has become a HR hot topic and for good reason.   More than one-in-three American workers today are Millennials (adults ages 18 to 34 in 2015), and this year they surpassed Generation X to become the largest share of the American workforce, according to 2015 Pew Research Center analysis of U.S. Census Bureau data. It is likely that experienced baby boomers approaching retirement may have different benefit and lifestyle priorities than your new millennial. While compensation and the quality of the work experience remain important across segments, failing to understand that different generations may have different expectations and preferences can lead to challenges at all levels of the organization. With the youngest baby boomer being age 52, doing the math lets you know that in 10 years, your company is going to look a lot different than it does today.   Utilizing a workforce leadership and education consultant to bridge the communication gap is integral to growing a sustained, experienced new group of employees.

Benefits and Compensation

gen diffMillennials are bringing to the table a new set of benefit expectations for you to examine; therefore, it can be easy to lose sight of traditional compensation and benefits. However, these areas still give employers an edge in recruiting and retention. One study discussed by SHRM found that 62 percent of Millennials would leave their jobs for better family benefits. The same study found that 41 percent indicated that a lack of family-friendly support had negatively impacted their work experience. As a result, it’s useful for companies to evaluate what their competitors are offering their employees. Are compensation and benefits on par with industry best practices or averages? Millennials need to feel valued and do not need any extra incentive to look for a job with your competitor. It is a good business practice for all generations of your employees to make sure their compensation and benefits are in line with industry standards.

Flexibility

The continued rise of trends like telecommuting, flexible scheduling, freelancing, and job sharing has shaped Millennials’ expectations of the workplace. As they advance in their careers, they’re more likely to be concerned about work-life balance, whether it’s in response to family demands, health, or outside interests. Companies that provide some level of flexibility are often able to hire more millennial talent by taking steps such as experimenting with unlimited vacation time and implementing structured telecommuting policies. While there are a wide variety of benefits around the idea of work-life balance, it’s important to be realistic about what works for your company, workflows, and culture. However, in general, the more you’re able to provide your workers with flexible benefits, the easier it may be to retain millennial employees.

Collaboration and Learning

shutterstock_126190568.jpgCollaboration and feedback are critical to keeping Millennials satisfied at work. Businesses are faced with how to make that crucial communication a reality. Finding ongoing ways to support learning and collaboration, from formal mentorship programs to investing in training programs, may also help increase retention. Today’s younger workers have a strong desire to contribute, but also want work-life balance, flexibility, and collaborative environments. By recognizing what energizes Millennials at work, it may be easier to create more effective employee retention programs.

Jamie Kertis, AIF®, QKAjamie kertis headshot
Retirement Plan Specialist
Grinkmeyer Leonard Financial
1950 Stonegate Drive / Suite 275 /Birmingham, AL 35242
Office: 205.970.9088 / Toll-Free: 866.695.5162
www.grinkmeyerleonard.com

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