While user experience is a major focus in the technology world, it’s time to start looking at retirement from the end-user experience as well, said Mike Tuira, vice-president of defined contribution at Invesco Canada Ltd., during Benefits Canada’s 2019 DC Plan Summit in Banff, Alta. in February.
The four elements leading to retirement success are plan governance, plan design, investment strategy and participant engagement, he said, noting when it comes to participant engagement, for example, plan sponsors should use language that’s plausible, positive, plain-spoken and personal.
“Make it believable. Don’t try to sell [plan members] something. Don’t sell them a pipe dream. Most of the people [will] tune you out if they don’t believe you. You lose credibility.”
When it comes to investments, employers can align plan members with a fund’s measure of success by focusing on outcomes instead of benchmarks, said Tuira. “The math is important, but we can’t only treat it as a math problem. We need to make sure we also treat it like a people one.”
For plan sponsors, this can include using benchmark agnostic traditional strategies, risk allocation funds, multi-asset funds, diversified growth funds, smart beta and private assets, Tuira added, noting some of these strategies can be used as a stand-alone option, as a series or within a fund of funds structure.
Read more coverage from the 2019 DC Plan Summit.