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It’s one thing to make a list of what’s in a retirement and benefits plan. It’s another to figure out how to add a value—an actual dollar sign—and share that meaningfully with employees.

But if you think employees already understand how much a retirement and benefits plan is worth to them, think again. For example, employees often don’t know they have a benefit at all: 25% of small businesses have added benefits, but only 8% of employees said their employers have increased benefits, according the Principal^® Q1 2024 SMB Sentiment Survey.

Why does it matter? Recruitment and retention, for starters: Putting a dollar figure on what’s in a compensation package helps you stand out, keep and attract the best talent, and stay competitive. And making sure employees—new and long-term—understand both what’s included in compensation and its total value helps everyone get what they need, when they need it.

Here’s how to create a holistic representation of the value of your compensation package that includes retirement and all benefits, and how to communicate that to all your employees.

Create a master list of all your benefits

Say “benefits and retirement” and many employees might think about just a few, familiar categories—health insurance, for example. And they may not know what your business is required to provide versus what they choose to provide because it supports the culture and employee needs and wants. The distinction may be important, particularly with robust voluntary benefits. The benefit categories typically include:

1. Standard, or mandatory, are those required by the federal government and, in some cases, by state government. On the federal level those include Social Security, Medicare, workers’ compensation, unemployment insurance, health care (if the business has 50+ employees), and family and medical leave (if the business has 50+ employees).
2. Voluntary may include health insurance (if not required by business size), dental insurance, vision insurance, life insurance, disability insurance, retirement plans, PTO/FTO, paid holidays, sick leave, dependent care, and employee assistance programs.
3. Lifestyle benefits may include a variety of extras such as gym memberships, wellness and other perks, time off for volunteering, tuition reimbursement, and hybrid or remote work arrangements.

Put a dollar figure on each piece of your retirement and benefits plan

This is harder: Because every business is different, the specific retirement and benefits plan package may differ too. There’s no one standard source of truth for a cost you can use. However, your financial professional may be able to help if you don’t have a human resources department.

Share info about your retirement and benefits plan on Day 1

For Ashley Buckles, commercial sales training manager with Shaw Industries Group in Dalton, Georgia, the communication begins when an employee does. And it’s the favorite part of her job.

“I work with our new sales trainees to introduce them to all of the amazing things about our company,” she says. “When it comes to retirement and understanding financial savings, I really think it's important to give them all of the information so they can start early, similar to how I was given the information when I first started with the company.”

Consistently communicate what your benefits are (and how much they’re worth)

Set up a regular cadence to communicate about benefits, compensation, and culture. At PlanOmatic in Denver, that includes recurring sessions every six months. “Our employees learn something new every single time,” says Kennedy Watson, head of people and culture. “I think that as benefit offerings get more competitive and there's more and more you can offer your team, educating them on how to engage with those, how to take advantage of those, is just a necessity.”

Spotlight the value of different benefits for different generations

No two people care about the same benefit in the same way; they have different goals and needs. And generations often care very differently about some benefits than others.

Consider highlighting voluntary benefits that aligns to an employee’s life stage. “So if someone has a young family at home, highlight a paid time off policy that allows for flexibility to account for those younger individuals,” says Kara Hoogensen, senior vice president of Benefits and Protection and head of workplace benefits at Principal. “Benefits conversations shouldn’t just happen at enrollment time. It’s about being intentional in communicating: Here are the benefits we have, here’s the why behind the benefits that we're offering, and here are the needs that we anticipate those benefits are going to meet.”

For example:

• Gen Z may look for retirement, , lower premium and out-of-pocket cost for health insurance, fitness club membership or workplace gym, and pet insurance.
• Millennials often value retirement programs and mental health benefits as well as fitness club membership or workplace gym, paid parental leave (across gender identities), Flexible Spending Account (FSA) for childcare expenses, assistance with building families (adoption, infertility coverage), vision a�Ի� dental insurance, and pet insurance.
• Gen X might want paid parental leave (across gender identities), caregiving benefits or leave, and voluntary coverage (life, long-term care, critical illness, accident insurance, hospital indemnity).
• Baby Boomers could prefer fitness club membership or workplace gym, vision and dental insurance, voluntary coverage, caregiving benefits and leave, and discounts on health services (e.g., chiropractic care).

Communicate in lots of different ways

Compensation, benefits, and culture all take time to understand. Some employees learn differently than others, too.

At Shaw Industries, the team always works on education, especially when it comes to financial wellness for the workforce. “A lot of people may not pay attention to their financial wellness over the long haul until late in their career, and we want early adopters,” says David Morgan, executive vice president of operations.

Communication strategies include quick bits of information in facilities and reminders and materials mailed to homes. “[We have] a very diverse workforce, people with different backgrounds, different experiences from different countries, and … we have to understand how to communicate with them in their preferred language so they can understand the benefits that we bring,” Morgan says.