Speaking the Same Language
Plan terms that have different meanings
can create barriers to confident
participant decision-making.
contribution
('käntr'byoo
-
SH( )n).
Gift or donation to charity
match (maCH).
Something to light
a fire with; an athletic
competition; the product
of a dating service
deferral (d 'f r l).
The act of putting
something off
Millennials in particular
?
found some terms difficult
to understand, such as:
Plan participant
63%
Millennial
respondents
44%
Total
respondents
Defined contribution
retirement plan
88%
Millennial
respondents
According to survey responses*,
participants' preferred term for the
percentage of their paycheck that
they save in their retirement plan:
Contribution rate
43%
How much of your paycheck
you automatically deposit in
your retirement account
Retirement savings
percent (or rate)
Savings rate
Deferral rate
18%
16%
14%
9%
* " Boosting the Effectiveness of Retirement Plan
Communications, " Empower Institute
Employers can
help participants
by making
retirement
communications
clear and free of
industry-speak.
Some examples
of jargon are:
Allocation
Registered
investment
adviser
Rollover
Withdrawal
strategy
Retirement
income
Retirement
readiness
Source: Empower Institute
Managed
account
vs.
Professional
account
management
Assets
Sometimes just a few
additional words can help
explain a term that people
otherwise find confusing.
Original
term
Match
vs.
vs.
Clarified
term
Employer
match
Retirement
savings and
investments
76%
Total
respondents
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