Simply stated, offering employees retirement education is the right thing to do. Retirement plans are complex and not easily understood by the average employee. More employees would participate in corporate retirement plans if they understood them better. If you are offering a 401(k) plan to your employees, but not sharing the value of the plan or how to use it properly, you aren't really committing to a solid retirement program.

Further, as a plan sponsor, it may be a wise fiduciary decision for you to provide education sessions. If you follow the guidelines for complying with section 404(c), you can obtain protection from certain participant lawsuits. However, in order to gain this protection, you need to share plan information with participants. Employee education sessions help you document the information-sharing process.

From my experience giving employee presentations for over 25 years, I have learned that the most successful employee education programs have eight common characteristics. These top-of-the-line programs are:

1. Topically timely. A common discussion topic right now is participant re-commitment to properly contributing and allocating assets. Many plan participants have yet to resume contributing (they stopped during the market meltdown) or re-commit to riskier assets, like equities. These are some of the issues of the day.

2. Easily understandable. It's probably not necessary to review the Sharpe ratios of the investment funds in your plan. However, talking about basic diversification and risk tolerance is very important. There are a number of fun-to-take quizzes available to help participants gauge their risk tolerance. It is well worth the time to administer the quiz.

3. Full of facts. Did you know that, according to a 2009 Alliance Bernstein study, 401(k) plan participants need to average 13.5% in contributions in order to retire without reducing their standard of living? Using fact-based employee education opens the eyes of participants and makes your sessions more relevant.

4. Culturally appropriate. Your company has a unique culture. Whether you're an engineering firm or a manufacturer, the employee education sessions you present need to be appropriate for your culture. Resist off-the-shelf solutions many vendors will offer. Instead, work with someone committed to crafting a session that is suitable for your company.

5. Supported by and supports your other communication programs. A consistent, on-message annual employee education effort is worth much more than you will pay to design it, in employee retention and appreciation alone. A message that is supported by your other communication efforts is better understood and accepted by employees.

6. Fun! Remember, we're trying to educate adults here. We aren't going to lose your employees (generally) to discussions with their neighbors. Instead, if not properly engaged, they will power down, turn off and worst of all, possibly fall asleep! To have meaningful employee education sessions, employees have to be engaged to a high degree. Effective education sessions often feature employees talking more than presenters. These are not easy sessions to design or present. However, if your company is offering them, you'll know they're successful based on the feedback that you get.

7. Short. Hour-long training sessions where a presenter grinds through 60 or so slides are not appropriate. Twenty or 30 minutes is a good rule of thumb. Even heavily engaged employees tire of training within half an hour.

8. Handout-rich. Your employee may or may not be the financial decision-maker in the family. If it's possible for you to invite spouses and significant others to your sessions, do it. But more than likely, that won't be the case. So you need to make sure that your employee has enough hardcopy information from the session to share it with his/her significant other.

The Department of Labor has been much more interested lately in your efforts at sharing plan information with your plan participants. Annual employee education sessions help you share this information in a way that is easily documented. Sessions can be scheduled over the lunch hour (ask presenters to bring in pizza) or in conjunction with a benefits fair or open enrollment program. Kickstart a new round of employee education sessions for your plan participants today.

Contributing Editor Robert C. Lawton is a member of the Madison,Wis. Graystone Consulting team specializing in retirement plan advisory services, a business of Morgan Stanley Smith Barney. He has over 25 years of experience working with retirement plan sponsors and is a Chartered Retirement Plan Specialist. Lawton can be reached at robert.lawton@morganstanleygraystone.com or 608-283-2304.

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