Contact: Rebecca Lechner, (952) 346-6402
More Than 20 Major Minnesota Employers Pledge to Help Employees Improve Retirement Savings, Personal Finance Management
Best Buy, HealthPartners, SUPERVALU, U.S. Bank, Wells Fargo and others in Itasca Project form "Financially Fit Minnesota" to impact thousands of Minnesota families
Minneapolis, MN - More than 20 leading Minnesota employers in the Itasca Project's new Financially Fit Minnesota program have pledged to help their employees close critical gaps in two key areas of personal finance - retirement savings and use of direct deposit for pay - in a statewide initiative that will impact thousands of Minnesota families.
The employer-led initiative is a response to troubling trends that, unless reversed, could spell disaster for the state's economic future. Less than half of Minnesota workers participate in an employer-sponsored retirement savings plan, including more than half a million full-time workers in the Twin Cities metro area, and many do not use basic banking services.
Making a measurable difference
Financially Fit Minnesota's 20-plus pacesetter companies are committing to making measurable increases in employees' rate of retirement savings and/or direct deposit use, and their actions are expected to impact a projected 15,000 employees of all income levels over the next two years. The near-term goal is to bring more employers on board and increase the number of Minnesota households impacted to 50,000.
Although many companies already have high rates of participation in retirement savings and direct deposit use, the program aims to encourage even greater participation. For example, some companies are changing their retirement savings programs from opt-in to opt-out, which has the potential to significantly increase the number of employees using their employer's plan and getting a percentage match for dollars they set aside.
"These simple, practical steps have a significant potential to positively affect the financial futures of thousands of Minnesotans," said Brad Anderson, chief executive officer of Best Buy and chair of the Itasca Project's Financial Literacy Task Force. "A growing number of people in our state are challenged by foreclosures, credit card debt or dwindling savings accounts. We as Minnesota employers have the ability and responsibility to apply practical, focused actions that can help working families achieve greater financial stability."
Financially Fit Minnesota employers are: Allina Hospitals & Clinics, Best Buy, Deluxe Corp., Fairview Health Services, HealthPartners, Jefferson Lines, Met Council, Minneapolis/St. Paul Business Journal, Mortenson Construction, Pentair, SUPERVALU, Target, Thor Construction, Thrivent Financial for Lutherans, Regions Hospital, Travelers, University of Minnesota, U.S. Bancorp, Weber Shandwick, Wells Fargo and Xcel Energy. The initiative has the support of Minnesota Gov. Tim Pawlenty, Minneapolis Mayor R.T. Rybak and St. Paul Mayor Chris Coleman.
"Saving for the future and ensuring financial fitness are important steps for every Minnesotan," Gov. Tim Pawlenty said. "I'm proud of the companies participating in Financially Fit Minnesota who are working to increase the number of those participating in retirement savings plans and using direct deposit. I hope that other businesses across the state will join this important initiative." Gov. Pawlenty today issued a proclamation that endorses the work of Financially Fit Minnesota.Gov.
Itasca Project members are encouraging employers of all sizes throughout Minnesota to join the effort. A new Web site, www.FinanciallyFitMN.org, is a resource for employers looking for tips and best practices to improve their employees' financial well-being. If your company is interested in getting involved in Financially Fit Minnesota, please contact Allison Barmann at (612) 371-3168.
About the Itasca Project
The Itasca Project is a four-year-old alliance of more than 40 Minnesota chief executives and elected leaders formed to address regional issues that affect economic competitiveness and quality of life.
Financially Fit Minnesota - Employer Commitments To Date
A number of influential pacesetter companies have already committed to boosting the financial fitness of their Minnesota employees. A summary of a number of commitments are posted below; additional commitments are expected at a later date.
Allina Hospitals & Clinics has a goal to maintain 90 percent or higher participation of match-eligible employees in their retirement savings plan, while increasing the average employee deferral percentage. The company also plans to make comprehensive financial education available to all employees.
Best Buy has a goal to increase retirement program participation. The company has committed to auto-enroll all new and current employees in their 401(k) programs, which will affect 1,200 employees.
Deluxe Corp. has a goal to increase enrollment in the company's 401(k) program by 200 participants and increase deferral percentage in 401(k) impacting 175 participants
Fairview Health Services has a goal to increase participation by 3 percent in its retirement savings plan impacting approximately 1,000 employees. The company plans to accomplish this through financial education campaigns.
HealthPartners has a goal to increase participation in employee direct deposit use by 1 percent. Earlier this year, the company switched to auto-enroll all corporate and health plan staff in the 401(k) program.
Jefferson Lines has a goal to increase participation in their 401(k) program by 50 percent and to increase participation in the company's flexible spending plans. To achieve these goals, the company plans to start a communication and educational campaign to targeted employee groups, among other plans.
Mortenson Construction has a goal to attain 100 percent participation in their 401(k) plan from salaried team members companywide by targeting approximately 20 percent of team members who are currently not participating. The company also plans to encourage team members to receive the maximum benefit from the 401(k) plan by increasing the deferral rate to 10 percent.
Metropolitan Council has a goal of 100 percent employee participation in direct deposit. Among their tactics, the Council will place all new hires on direct deposit beginning fall 2008 and implement a pay card for employees who do not have a banking relationship.
Minneapolis/St. Paul Business Journal has a goal to increase 401(k) participation by 10 percent and increase the percentage of contributions in 401(k) plans for current contributors by at least 2 percent.
Pentair is launching an automatic enrollment process and supporting communication campaign for employees who have previously elected not to participate in the company's 401(k) program.
SUPERVALU this year launched a new, automatic enrollment 401(k) plan and is aiming to increase plan participation of existing employees by five percent over the next year. Among many tactics, SUPERVALU will use mailings and educational meetings to help get the message out to non-contributing employees.
Target has a goal to increase participation in the 401(k) plan, focusing on team member groups with low enrollment. Target will also reinforce the benefits of direct deposit, focusing on new hourly hires.
Thrivent Financial for Lutherans has a goal to increase the number of employees participating in the 401(k) plan and increase the average deferral percentage of 401(k) plan participants. The company will increase the visibility of retirement programs within its new employee orientation process and help streamline their 401(k) enrollment process for new hires.
Travelers has a goal to increase 401(k) participation rates and increase 401(k) deferral rates, especially for employees that do not receive the full match. The company has an overall goal to improve employee understanding of total compensation, retirement planning, financial planning and asset allocation.
University of Minnesota has a goal to increase participation in their optional retirement plans by 5 percent by the end of 2009.
U.S. Bancorp has a goal to increase employee education for the company's 401(k) program - especially among groups of employees who tend to have lower 401(k) participation rates - by holding educational seminars and conducting marketing campaigns such as mailings and informational postings in key employee areas.
Weber Shandwick has goals to increase participation in the company's 401(k) program by 15 percent, focusing particularly on younger employees, and to increase per-paycheck contributions across the office. Weber Shandwick will launch quarterly educational sessions, distribute informational materials and appoint 401(k) advocates to encourage participation among employees.
Wells Fargo has a goal to increase 401(k) participation among their Minnesota employees by more than 5 percent. The company has planned a targeted marketing campaign to increase 401(k) enrollment particularly for non-exempt employees. The campaign includes mailings, seminars and an emphasis during new employee orientation.