Marriage, communication, & auto-enrollment
Timothy R. Yee, AIF, CPFA?, C(k)P?, CHSA, NQPA, CSRIC?, RI(k)
President at Green Retirement, Inc.
32 years ago, round about 11 AM, we said, "I do" at City Hall in San Francisco. It has been a wild ride to say the least. I am not sure either of us could have predicted everything that would transpire. Each year is even crazier than the one before. Past performance is no guarantee of future results applies equally to marriage as it does to investments.
There are many reasons our marriage has lasted not the least of which is my wife's inexhaustible store of patience for my crazy shenanigans. I would like to think communication is one of the reasons though for our marital longevity. We do our best to make our needs known and to really listen to the other person. Some days are better than others.
But as always, our 401k practice is never far from my thoughts. I was reflecting on one plan sponsor who agreed to auto-enrollment. Some months after, I noticed new employees who were eligible were not in the 401k plan. Did they sign a document opting out? A quick call to the plan sponsor revealed that he had never auto-enrolled the new employees or even discussed it with them because he was concerned about their reaction to having money deducted from their paycheck. Communication failure perhaps?
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Another plan sponsor rebuffed my suggestion of auto-enrollment as "socialist" and something that she knew would never fly in her company. It was against their company culture .That certainly could be the case. She is closer to the employees and corporate culture than I am. And yet, if the plan is repeatedly failing ADP/ACP testing and issuing refunds to the HCEs, might auto-enrollment be worth broaching with employees? Communication. It's a thing.
I am not saying communication solves everything. My wife and I have had heated "communication" in 32 years and I have "enjoyed" a few nights on the couch. Burying our heads in the sand and not communicating though is not an option. Given that the purpose of the 401k is help employees retire with dignity, might auto-enrollment be worth communicating about?