Dutch financial giant, ING is now offering the Roth 401(k) and Roth 403(b) to its clients, and has also created two “education kits” for employers and employees to help explain the Roth option.
“The debate on the Roth option so far has centered around whether it’s beneficial for employers to offer the Roth to their employees and if employees should elect this option,” said Brian Haendiges, senior vice president, ING defined contribution. “The broader issue is improving retirement savings across the board. The Roth is one more option that employees can use to do that, and we want to make it easy for employers to add this feature if they choose.”
The employer toolkit offers a balanced view of the various factors employers need to weigh to decide what’s best for their organization and its employees. The employee education kit is a multi-media kit comprised of a variety of action-oriented tools including an educational presentation and an online Roth calculator.
According to Haendiges, behavioral finance research shows that employees often feel overwhelmed with information. And too much information often leads to little action. ING’s goal is to make any communication on the Roth option easier to understand.
“In 2005, the savings rate among US consumers dipped negative, to -0.5%, the lowest since the Depression,” said Haendiges. “We all have to do what we can to try to prevent the pending retirement funding crisis. And encouraging that savings should be the goal of every employer and provider, and anyone else who can influence the decisions of the participants.”