Products October 7, 2010

Mutual of Omaha Teams Up With the 401k Coach

Mutual of Omaha has enlisted the help of Charles Epstein, the creator and “coach” of “The 401k Coach” program, to provide advisers with training and business support.
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“Coach” Epstein and Mutual of Omaha said in a news release that they’ve designed a year-long program for advisers which will give them the “clarity, confidence, and capabilities” they need to build and grow a practice.   

The program begins with an intensive, full-day “boot camp” training experience, which consists of the following parts:

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  • The Impact Formula – a way to move beyond your “value proposition” and show clients how you plan to measure success.
  • Pre-Call Reconnaissance: The 5500 and Beyond – preparation tips before that first meeting with a prospective client.
  • Command and Control: Conducting Extraordinary Meetings – the “Coach” will demonstrate various scenarios and case studies that will increase your closing ratio.
  • The Positioning Marketing System – tools to develop a consistent marketing message.
  • 12 Critical Actions for Increased 401(k) Sales and Plan Servicing Success – self-assessment tool for eliminating pitfalls and focusing on your best opportunities.
  • Action Hour – creating a successful action plan and a system for communicating, documenting, and monitoring your team’s progress and success.

After the boot camp, attendees have access to a 12-month educational program that includes e-newsletters, webinars, and resources and tools from The 401k Coach Program.  They’ll also have ongoing access to member-only online resources as well as support and consultation from Mutual of Omaha and The 401k Coach team.

The first boot camp was held in Lansing, Michigan on September 23rd.  Five additional boot camps are scheduled for:

  • Pittsburgh, October 14th  
  • Orlando, October 28th  
  • Minneapolis, November 4th  
  • Kansas City, November 11th  
  • Dallas, December 9th  

 

Data & Research October 7, 2010

Auto Features Seen as Key to Retirement Saving Success

A new study finds that auto-enrollment and auto-contribution escalation in 401(k) plans can result in a big improvement in retirement savings, depending on how they're implemented.
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A news release said that automatic features in 401(k) plans increases the likelihood of younger employees – those with 31-40 years of work ahead of them – by more than 30% of being able to hit an 80% pre-retirement real income replacement target for both low and high income workers.

These findings are part of new research by the Employee Benefit Research Institute (EBRI) and the Defined Contribution Institutional Investment Association (DCIIA).

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The study finds that 401(k) plans are more likely to achieve the desired results if they have a higher automatic-enrollment contribution rate cap, a successful program to reduce automatic contribution escalation opt outs, and a higher annual auto-contribution escalation rate.

“Our simulation models have shown for some time that auto-enrollment and auto-escalation are likely to have a tremendously positive impact on workers’ retirement savings,” said Jack VanDerhei, EBRI research director and author of the study, in the news release. “Increasingly, we are now able to quantify just how big that impact will be.”

Among the other findings in the study:

  • Increasing the auto-contribution escalation cap had by far the greatest impact of any factor on increasing the probability of success in the analysis (as defined by participants achieving an 80 % real replacement rate in retirement), with a projected 16.4%-increase for the lowest paid workers, and a projected 14.1 %-increase for the highest paid workers.
  • Successfully discouraging opt-outs in auto-contribution escalation, ensuring that employees remember and implement deferral levels from their prior 401(k) plan instead of remaining at the auto-enrollment default, and increasing the annual auto-contribution escalation rate from 1% to 2% individually had a much smaller impact, ranging from 0.4% to 1.8%.
  • When all four design elements and behaviors are optimized, the probability of success increases 33.5% to 37%, depending on income quartile.

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