To simplify the process Aon Hewitt suggests plan sponsors and providers work together to make the process less arduous for employees. For example, periodically, and at an employee's termination, employees could be provided with resource materials or an educational campaign explaining the benefits of employer-provided plans, with clear and simple instructions on how to roll one plan into another. Plan sponsors could post this information on provider web sites along with phone numbers and web links for help.
Maintain an attractive investment line-up. One of the main reasons that IRA providers encourage rollovers out of an employer plan is because of lack of breadth of available investments compared to an IRA. Plan sponsors can help employees make the most of their retirement dollars by offering low-cost institutional core investment options, complemented by a self-directed brokerage (SDBA) option that provides access to the broad universe of mutual fund alternatives.
Offer an attractive retirement income option for those nearing retirement. Aon Hewitt's research shows that 29 percent of plans currently provide employees with some form of retirement income solution, either inside, or outside the plan. Including easy and flexible monthly payments, income planning and investment help and/or annuity options would give employees nearing retirement an added incentive to stay within the employer-provided system.
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