The retirement plan provider says its campaign could raise AUM for advisors with retirement-plan clients.The retirement plan provider says its campaign could raise AUM for advisors with retirement-plan clients.
Money that taxpayers saved from the extension of the payroll tax cut should be invested in retirement plans, The Hartford is advocating.
The Hartford's Two for Tomorrow campaign encourages 401(k), 403(b) and 457 participants to use the 2% payroll deduction Congress approved in February to increase their allocation to their retirement plans by that amount.
"This is a way to increase the contribution amount without feeling a loss," says Dana McCullough, assistant vice president at The Hartford, manager of participant education and the director for the campaign.
After Congress extended the 2% decrease in the payroll tax deduction for Social Security, The Hartford began working with retirement plan sponsors to encourage participants to use that money to increase the amount they contribute to their employer-sponsored retirement plans. The addition to a retirement account can amount to more than 2% with the employer's contribution.
The campaign includes educational material, e-mail, posters and a staff to visit workplaces and meet with financial advisors, employers and employees.
"This is an opportunity for advisors who have retirement-plan clients to attract more assets under management and more participants," McCullough says. "It makes it easy for the advisor to add value to the retirement plan. Through the campaign, the advisor can easily tell the story."
"One employer used our e-mail to let employees know about this possibility, and within eight minutes he was getting calls from employees wanting to increase their contribution levels," McCullough says.
The Hartford has calculated that over 30 years, the extra 2% contribution can mean another $83,000 in a retirement account if the person earns $50,000 a year and another $126,000 if he earns $75,000 a year based on a 6% rate of return.
The Hartford administers 32,000 employer-sponsored retirement accounts with more than a million participants and $52.3 billion in assets under management.