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If your retirement plan administration is solid, why does engagement still feel so fragile?
Many plan sponsors have improved 401(k) fundamentals by adding auto enrollment, diverse investment options and competitive employer matches. Yet, the question remains: why aren’t people more engaged with the plan and the tools offered?
As we head into Father’s Day in the U.S., I’m reminded that progress, whether in parenting or financial decision-making, rarely comes from just having the “right” structure. It comes from how well that structure supports the day-to-day experience of life.
Participant engagement isn’t just enrolling or clicking through a website once a year. It’s understanding, valuing and using your 401(k) as a core part of one’s financial life. Alight’s 2025 Alight Employee Mindset Study shows that more than 50% of participants are visiting their retirement plan’s site almost weekly, which is just the start. Here are a few ways plan sponsors can care for employee engagement and drive better outcomes.
Connect 401(k) engagement to broader financial wellbeing
For many employees, retirement feels (and is) distant compared to today’s financial stressors. That’s why leading sponsors embed 401(k) engagement into broader financial wellbeing strategies—connecting saving for retirement with other skills like budgeting, debt management and working toward near‑term goals.
It’s similar to parenting: when you’re struggling with a newborn, advice about what sleep should look like in a year isn’t very helpful. What moves you forward is tackling tonight’s immediate needs first—feeding schedules, bedtime routines and manageable steps that restore confidence.
In the same way, when employees continue to take small steps toward their financial wellbeing and feel more confident about meeting today’s needs, they’re more willing and able to build long‑term savings.
Start with relevance, not education
Traditional financial education assumes participants are motivated to learn. In reality, many employees feel overwhelmed or are unsure where to start—not unlike most new parents.
Instead of leading with education, lead with relevance. Meet people where they are, whether that’s paying off student loans, managing financial priorities or thinking seriously about retirement. As communication and tools address in-the-moment needs, engagement follows.
When he was a baby, my son was a terrible sleeper. Thankfully, I found a book with a chapter titled “An action plan for exhausted parents.” This spoke to me. I could not read it fast enough. It felt like exactly what we needed in that moment, not reassurance that his sleep was “normal” and not a lesson on why babies wake up at night. We needed practical, relevant action steps and we needed them right that minute. (It’s also a good reminder that evocative language matters; a chapter called “More sleep tips” would not have grabbed my attention in the same way.)
The same is true with finances: when people are tired, stressed or facing a real decision, they need clarity, guidance and an action plan.
Make trust central to the experience
Employees are surrounded by money advice from a million different places, including friends and family, social media, podcasts, apps, influencers and more. Some of these sources are great, others not so much. Amid the noise, participants are more likely to act when they believe the guidance is unbiased, transparent and genuinely in their best interest.
The same dynamic shows up in parenting. When you’re looking for advice, there are lots of people who are happy to share. You decide who feels honest and what aligns with what’s best for your family. Trust is earned and reinforced by showing up consistently, being clear about intent and acknowledging complexity rather than glossing over it.
For plan sponsors, this means avoiding conflicts, clearly explaining what participants are getting and being transparent about why it matters. Alight’s Mindset Study shows , that 51% of employees said they would take some level of advice from an employer-sponsored third party such as Alight Financial Advisors on saving for retirement. When employees trust the source, especially in a crowded information landscape, they’re far more likely to engage with the guidance offered and value it.
Alight can help!
In parenting, progress often accelerates when you have the right support system—people, tools and guidance that show up at the right moments and make the difficult things feel more manageable. Consistency matters just as much. Simple expectations, like reminding a child to push in their chair or hang up their towel, aren’t one‑time lessons. They require steady reinforcement over time to build lasting habits. Bringing these retirement engagement principles to life works the same way.
By combining data, behavioral insight and deep client knowledge, Alight partners with sponsors to move beyond measuring activity and toward creating momentum so engagement becomes a natural outcome of a retirement program that truly meets people where they are.
