Rice offers tools to help employees plan for successful retirement

Rice
offers tools to help employees plan for successful retirement
…………………………………………………………………

BY QUENTIN MASTERS
Special to the Rice News

With the combination
of Rice’s contributions to employees’ retirement
accounts (at least 7 percent of salary) and the ability
to contribute additional money (up to about 15 percent of
salary) to a Supplemental Retirement Account, there is the
opportunity to build retirement savings that can make a
significant contribution to retirement years.

If employees
start early enough, these options can make it reasonably
easy to make sure sufficient funds exist to make retirement
far better than mere survival.

But, to make
those funds work well, the money needs to be invested in
a manner that enables it to grow and work for employees
both in the working years and in retirement. There has been
a movement away from defined benefit plans (where the plan
provides a fixed amount, normally based on years of service
and salary level achieved) to defined contribution plans
(where the employer contributes a percentage of salary to
the employee’s retirement account). Rice has had a
defined contribution plan in effect for many years now,
and a major element of that shift has been to move the responsibility
for choosing how to invest the money in that retirement
account from the employer to the employee.

Rice offers
faculty and staff a number of tools, at no cost, to assist
in making those investment choices wisely. First, there
are frequent workshops, offered by both TIAA-CREF and Fidelity
representatives, to help employees better understand the
options within the retirement plans and general retirement
planning information. These are offered on campus, kept
to about an hour each and announced by mailings to home
addresses, with e-mail reminders sent to all departments.
Both TIAA-CREF and Fidelity representatives also offer individual
meetings to discuss personal questions about retirement
accounts.

Financial Engines
is an online investment advisory service that Rice has made
available to faculty and staff to assist them in the management
and investment of their retirement accounts. When an individual
establishes a Financial Engines account, he or she makes
up a password to protect the confidentiality of the account
and then may enter information such as date of birth, intended
retirement age, present savings rate and present funds or
choices where retirement funds are invested. Financial Engines
can then be asked for a forecast to estimate whether present
savings, rate of saving and investment choices will allow
the employee to meet his or her financial goal at retirement
age. It also will, upon request, provide suggestions on
adjustments to choices of investment that may help employees
reach their goals. Financial Engines will help with two
critical questions: “Am I saving enough?” and
“How should I be investing the money?”

Finally, for
those with five years or more of benefits-eligible service,
Rice offers financial planning through the Money Sense program.
Those with fewer than five years may participate but must
pay the class fee themselves. This program includes two
workshops covering money management and retirement planning
issues and the creation of a personal financial plan by
the Money Sense adviser. The plan is delivered to and discussed
with the individual. No one else at Rice has access to any
part of the financial plan, nor does anyone have access
to personal information in the Financial Engines accounts.

More information
on both programs is available at <www.ruf.rice.edu/~humres/Services/Benefits/>.

Rice is considered
to have a generous retirement plan relative to others’,
and these tools offer the opportunity to use that retirement
plan and employees’ own voluntary contributions well.

— Quentin
Masters is an assistant human resources director.

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