A large retirement services vendor is trying to use streamlined paperwork to persuade workers to save more for the future.
Principal Financial Group Inc., Des Moines, Iowa, says its new Easy Enrollment can increase participant savings by breaking the enrollment process into 3 components:
- The “Smart Start” step, or process for deciding how much to save.
- The “Principal Step Ahead” step, which involves scheduling future automatic increases in savings rates.
- The investment-selection step.
The Smart Start step can help increase the average participant deferral to about 5%, from the typical average of about 3%, and the automatic increase step gets the typical participant to schedule a deferral percentage increase of about 1.4 % per year for 5 years, Principal says.