Personalized investment advice helps 401(k) savers

March 27, 2024

The unemployment rate has remained below 4% for the last year or more, emphasizing the labor shortage that continues to be a pain point for organizations looking to fill open positions.1 Wanting to stand out from the competition, some employers are strengthening their benefits packages to include flexible work environments as well as better salaries and health benefits.

Not to be overlooked are retirement benefits, like a 401(k) plan, which may be a differentiator among job seekers. Employer matches are relatively commonplace, so how can an employer truly stand out from the sea of competing organizations that offer similar benefits? 

Let a potential hire know that you go beyond simply offering a retirement plan. Show them that you provide the following potential benefits of professional and personalized investment advice to go with it.

Help with key financial decisions

Determining how much of their paycheck to direct to a retirement plan may be relatively straightforward for some. And, once that decision is made, it may only need to be reviewed and tweaked annually.

In the meantime, however, employees may be faced with major financial decisions that warrant help from a professional. Some life events that may benefit from a one-on-one conversation with a financial professional include:

  • Buying a home
  • Selling or purchasing a timeshare
  • Receiving an inheritance
  • Going through a divorce
  • Paying for college tuition or a wedding
  • Paying off debt
  • Investing elsewhere (e.g., annuities, CDs, money market, stocks, bonds)

Many more scenarios may impact an individual’s retirement goals, and working together with a financial professional to navigate through each is a distinct benefit that current and prospective employees may value.

Determining retirement age

As it stands today, an employee born in 1960 or later will need to wait until age 67 to reach full retirement age and receive their full Social Security benefit. While employees are generally aware that benefits will be reduced by claiming early, they might not realize to what extent. For example, if that same employee claims Social Security benefits beginning at age 62, their benefits will be reduced by a whopping 30%!2

That’s not to say an individual can’t retire early. The strategic advice offered by a financial professional may help determine ways to bridge the gap between that retirement party and having to claim Social Security benefits. It may involve withdrawing from pre-tax accounts, working part-time or a host of other options. A financial professional can help employees weigh their options and come up with the best way forward.

Calculating expenses in retirement

A major part of determining when to retire is knowing how much someone will spend in retirement. Someone who plans to retire in five or 10 years will need to consider their future cost of living, housing situation and overall retirement goals. A financial professional can help draw out potential barriers to retirement and help overcome them by asking relevant questions, including:

  • Will your mortgage be paid off in retirement?
  • Do you plan to downsize or move elsewhere?
  • How much do you expect to pay for healthcare?
  • Do you plan to travel?
  • What kind of financial legacy do you wish to leave for loved ones?

The average individual between the ages of 65-74 will spend nearly $61,000 each year.3 Exploring these topics holistically can help a potential retiree better assess their income needs and where there may be gaps. A financial professional can help strategize potential ways to ensure someone doesn’t run out of money in retirement.

Mitigating tax risks

A tax-deferred retirement plan offered through a workplace can be beneficial in the long run. However, individuals need to assess their potential earnings and associated tax brackets once they enter their golden years.

Determining a financial strategy to potentially minimize someone’s taxes in retirement may require some creative fund allocations and withdrawal strategies outside a workplace retirement plan. The average worker may not have the knowledge or time to determine their current tax liabilities, let alone those after retirement. A financial professional can help provide guidance and confidence moving forward.

As fiduciaries, plan sponsors and financial professionals can help employees make sense of their entire retirement outlook beyond just their employer-sponsored plan. And for potential recruits, knowing they’ll have personalized conversations as part of their employee benefits may make all the difference in deciding whether to accept an offer.


1U.S. Bureau of Labor Statistics, The Employment Situation — December 2023, 2024, January 25 

2Social Security Administration, Starting Your Retirement Benefits Early, Accessed 2024, January 23 

3U.S. Bureau of Labor Statistics, Table 1300. Consumer Expenditure Surveys, 2022, 2023, September