Scoring Big in Retirement Plans: Lessons from Soccer for Business Owners and Retirement Plan Sponsors

In celebration of the Women's World Cup which will wrap up this weekend in Australia after five weeks and 32 countries participating, we're going to dive onto the soccer field to uncover some insightful parallels between The Beautiful Game and your organization's 401(k) or 403(b) plans. Trust me, you're in for a match-winning strategy that combines teamwork, long-term vision, and a few penalty kicks (of the financial kind). Let's lace up our boots and head out to the pitch.

Team Cohesion is Key:

Soccer: Picture a team of 11 players moving in perfect synchrony, each playing a crucial role to secure a goal. It's the power of collaboration!

Retirement Plans: Just like a well-coordinated soccer team, a successful retirement plan relies on the seamless collaboration between Plan Sponsors, Retirement Plan Advisors, service vendors, and yes, your employees. Everyone plays a part in scoring a financially secure retirement.

Game-Long Strategy:

Soccer: A soccer match spans 90 minutes (plus stoppage time each half, potentially extra time and penalties - that can be a long game to remain energized and motivated!). Teams need a comprehensive game plan that adapts to the opponent's moves and changing conditions.

Retirement Plans: As a business, providing a retirement plan and assisting employees in saving for retirement is a marathon, not a sprint. A robust intentional strategy should account for an evolving regulatory landscape, market fluctuations, shifts in participant demographics, and incorporating the sponsoring organization's goals, values, and budget considerations.

 Aiming for the Goal:

 Soccer: Every play in soccer aims to put the ball into the net. It's all about those goals!

 Retirement Plans: Similarly, overseeing a retirement plan is about understanding your plans metrics and achieving your identified goals. Think of your plan's success as the final score you're striving to achieve—a retirement where participants live comfortably.

 Yellow Cards & Early Withdrawal Penalties:

 Soccer: A yellow card warns players about their behavior on the field.

 Retirement Plans: Similarly, participants face "penalties" when withdrawing from their retirement accounts prematurely. As plan custodians, it's essential to educate them on the impact of early withdrawals, and all aspects of the retirement plan.

 Substitutions & Plan Changes:

 Soccer: Coaches make substitutions to keep their team fresh and responsive.

 Retirement Plans: Likewise, Plan Sponsors can be considered the head coach for their organization's retirement plan, ultimately responsible making substitutions in the plan's management - though they can have a robust team of co-captains. This may most frequently be seen when incorporating investment changes. Plan Sponsors can also have power to make changes in service vendors, swapping one for another more prepared for the plan's current considerations. Plan Sponsors can also make changes in the plan document to allow for different style of benefits, or be receptive to an evolving regulatory landscape.

Final Whistle:

 Remember that just like in soccer, success for your organization's retirement plan requires a game plan, commitment, good coaching, and a dash of calculated risk-taking. As you rally your team (and plan participants!) and lead them towards financial victory, know that you're playing a vital role in securing their future. So, let's kick off a winning retirement plan, one goal (or contribution) at a time!

If you're looking for a Retirement Plan Advisor to help you start or manage your retirement plan, email today, Christina.Tunison@lpl.com. Christina can help you at the intersection of retirement plans & soccer! - in addition to the almost two decades of experience with retirement plans, she also spent several decades involved and playing in youth and adult leagues in multiple states and was also previously a USSF certified referee so she's very familiar with the rules of the game.

This information is not intended as authoritative guidance or tax or legal advice. You should consult your attorney or tax advisor for guidance on your specific situation. In no way does advisor assure that, by using the information provided, plan sponsor will be in compliance with ERISA regulations.

#486471 August 2023