Making a fair investment
Often, local governments struggle to teach their employees about the importance of saving money for retirement and the methods for fully taking advantage of their deferred compensation plans. King County, Wash., however, has increased participation and investments in its employees’ plan by organizing day-long participant fairs every two years. Last year’s event, held in October, had a futuristic theme complete with an Albert Einstein-like mascot, Professor Investor, to teach employees about the county’s plan.
Since 1998, King County has contracted with Baltimore-based T. Rowe Price to administer its deferred compensation plan, which includes 15 investment options with various levels of risk and return so employees can build accounts that suit their needs. Several years ago, when plan participation hovered around 30 percent of eligible employees, the county organized a one-day event at Seattle’s Benaroya Symphony Hall to promote the plan and encourage more employees to enroll. Since then, the county has held similar events every two years and, as a result, has increased plan participation to 41 percent of 13,500 eligible employees.
By the sixth fair in October 2005, however, county officials were concerned that employees would overlook it. So, to promote the fair, King County created the new theme and Professor Investor mascot that encouraged employees to think about the future and reminded them that retirement saving is not “rocket science.” The theme was promoted on postcards mailed to employees, posters in county buildings, announcements on the county Web site, invitations and agenda flyers.
The free, full-day fair included give-away items and raffle prizes, and the plan’s fund providers offered presentations, question-and-answer panels, investment-related workshops and meetings with representatives. In addition to appealing to current employees to participate in the plan, the fair also addressed retired employees’ interests and encouraged them to remain enrolled.
Attendance for the event was voluntary, but raffle ticket stubs suggest that more than 1,000 employees stopped by or participated in some way. Increased employee interest and responses demonstrate attendees are becoming more aware of the plan and more interested in learning about preparation for their financial futures. Professor Investor and the “It’s not Rocket Science” theme were so well received that they are now used on all branding efforts for the plan.
A follow-up attendee survey revealed that 86 percent of respondents found the fair information met their needs, and 57 percent of respondents intend to increase their contribution rates to the plan. Of those employees who were not participating in the plan, 57 percent said they would enroll immediately, and 29 percent intend to enroll within six months. Nearly two-thirds reported feeling more comfortable making investment decisions following the fair. Those results garnered a 2005 leadership award from the Lexington, Ky.-based National Association of Government Defined Contribution Administrators.
