Steps to Begin Educating Your Participants on Their Retirement Plans

How to inform and educate your participants on retirement planning:

Let’s first go over the definition of Inform and educate.

To “inform” means: To provide specific details about a topic in such a manner that it is useful in arriving at a solution to a felt need.

To “educate” means: To teach a participant how to apply financial principles using available information to solve an economic problem or provide insight into an issue of life.

So how do you begin?

Here are some steps you can take to begin helping your participants understand their retirement plans:

1. Review the details of the retirement plan as outlined in the Summary Plan Description: Who is eligible for what and when.

2. Help them understand how to access information about their plan.

3. Help them understand how to enroll, review, and make changes to their account.

4. Help them understand what investments are available and information about them.

5. Help them understand the legal limitations of the plan: contribution limitations, minimum contribution amounts, etc.

6. Show them where to find supporting resources: calculators, definitions, explanations.

7. Provide an adequate investment vocabulary.

A key issue of life is: Will you have enough resources when the paycheck stops to continue in a lifetime of ministry?

Here are some steps you can take to help your participants financially prepare for their future.

1. Learn how to construct a reasonable assessment of future cost of living.

2. Estimate how much income they will be receiving.

3. Check to make sure they are emotionally prepared.

4. Become familiar with the basic principles of investing such as:

   1. The impact of compounding

   2. The value of dollar-cost averaging

   3. The impacts of time, rate of return, and invested amount in achieving a desired financial result

   4. The meaning of risk and how to manage it

      1. Investment diversification

      2. Allocation of resources

And finally, it’s important to help your participants develop the skills and abilities to communicate with spouses and children about financial issues in the present and about future realities.

Click here to learn more about the retirement education Envoy provides.