Quick Summary: It’s a whole new world of decision-making for those just entering the workforce. They’ve never chosen medical coverage, thought about retirement plans, or considered whether they need life insurance. How will they make good decisions? Your guidance can make all the difference.
Coverage under a parent’s plan has probably been the norm for new college grads or first-time job seekers just entering the workforce. They have no idea how to choose a plan that suits their new situation. Use examples to explain how a low-cost, high-deductible plan might be good for a young, healthy person, but that someone with a growing family may need more.
You’ll also need to provide a primer on benefits terms. Remember that even the common ones, such as deductible and copayment, are foreign to them.
Here are some mistaken beliefs to address:
Dental and vision care are afterthoughts. Mom and Dad likely took care of this too. Show your benefits “newbies” how to total their expected annual expenses then compare that to the cost of coverage to determine if enrollment will be cost effective.
Retirement is 40+ years away. It’s almost impossible for them to envision themselves that far down the road, so 20-somethings often think retirement saving can be put off. Show them how compounding works and talk about the company match (if there is one). Point out the value of pretax contributions. Explain how it may get harder to save later as priorities change (such as starting a family and buying a home).
Life insurance is for married people. Remind these employees that life insurance also may be valuable for those who have debt (credit cards, student loans) or own property.
The studying stopped when they graduated. The only way for young people to learn how to use their benefits wisely is for them to become familiar with plan requirements before they need them. This means reviewing coverage documents so they know about networks, referrals, preauthorization, and other rules that might trip them up. Stress that time spent learning these ins and outs of the benefits plan will help save money in the long run.
Style matters. Your youngest workers are part of a generation dubbed the “millennials.” They’ve been raised in an age of constant (and instant) communication, making how you share information with them important. They are impatient and have short attention spans, so communication must be efficient and productive. Use technology, when possible, because they’re used to learning electronically.
Next Steps:
• Consider informally surveying recently hired young workers to see what benefits decisions they made and what information would have been helpful. Then use this information to tailor your communication plan—the tone, the method, and the message.
• Look for ways to make your communication with this age group match their style. Sell them on the value of benefits (including things like vacation time and personal days) and increase appreciation by letting them know that benefits are a sizable chunk of their total compensation (about 30% nationally).
Reaching the young and connected crowd can be tricky. Discover creative techniques you can use now in these articles: “Engaging the Young-and-Connected Crowd” and “Communicating with a New Generation—The Millennials.”
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