Early Retirement Incentives

HR Resource
December 26, 2012 — 1,650 views  
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Incentivizing Retirement

It can be a tricky thing to try to get people to retire when they don't want to do so. This is because pride comes into the picture. It is also obviously because people don't want to go into an early retirement for financial reasons.

The key in this case is to find ways to ease the implementation of retirement and help keep down the risks associate with retirement programs to make sure that employees are more attracted by them.

Lump sum programs, and 401k retirement plans are often a good way to help to get people to retire. Other tips for adding incentives for early retirement include-

-Health Care

If you offer your employees a plan that keeps them at the same rate of healthcare for an extended period of time after retirement, this can go a long way to making a retirement plan seem more worth it for an employee. It's also possible to offer health plans that cover the employee until they turn 65 years old. You can analyze these different plans different ways to figure out the total cost savings possible for any particular plan that you might offer.

-Life Insurance

Some companies even offer life insurance policies that can continue after retirement. The important thing in this department is to make sure that the plan remains the same as it was before. This is a key aspect of helping with retirement incentives. If employees see that nothing will change in any real significant way after they retire, they will be more inclined to go for it. It will seem more like an advantage than anything else. After all, the employee gets to retire, and not lose anything of significance. If you can show them that this is the case, any drop in income will seem secondary.

-Third Party Annuity

A regular sum of money is also often a good choice for drawing people in.

Announcements

It's a good idea to announce any early retirement plan as soon as it's ready, and to set the announcement date and the effective date at least a few months apart in order to give people time to think about and react to the plan. It's a big decision for them to make after all, and they hardly want to jump into it without carefully thinking it over beforehand. Adding this extra time will ensure that you get a larger number of people interested.

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