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Manufacturing
Companies Lead the Way in Defined Contribution Plan
Design
WITH THE FREEZING or termination of traditional
defined benefit plans, manufacturing companies are
focusing on offering enhanced features to their defined
contribution plans. In Diversified Investment Advisors
recent Report on Retirement Plans, manufacturing
companies lead the way in terms of considering the
implementation of auto-services such as automatic
enrollment, deferral escalation and rebalancing, versus
other industries. In addition, manufacturing companies
are more optimistic about the draw of enhanced
retirement plans on recruiting and retaining talent.
Advisors can better serve their manufacturing clients
and help them attain that competitive edge evaluating
their clients’ plan design to determine if any changes
are warranted. For example, standard plan design
elements in the manufacturing industry include at least
a 50% match on the first 6 percent of salary deferrals
as well as a broad investment offering of 11 to 20
funds. In addition, advisors should be mindful of what
makes manufacturing firms so unique with characteristics
such as:
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Shift differentials
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Language barriers
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Fewer traditional desk jobs— less access to
computers at work
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Employees of all education levels and skill sets
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Greater reliance on defined contribution plans—
manufacturing firms have more frozen defined benefit
plans than other industries
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Increasing use of employer matching contributions
By
evaluating their clients’ plan design against an
industry standard, advisors can add value by
recommending features and tools that can help them gain
an advantage in the highly competitive recruiting
marketplace.
Diversified Investment Advisors has demonstrated
expertise in meeting the needs of manufacturing firms.
To learn more about Diversified, call 800-770-6797 or
visit their Web site at
www.divinvest.com.
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