Workplace Loans

Resources and tools to help employees make informed decisions

No one anticipates having to dip into hard-earned savings before retirement. Yet, some find themselves needing that money to cover expenses, pay down credit card debt, or make necessary home repairs. If no other sources are available, borrowing money from a retirement savings plan may be the best option.

Since taking a loan can impact retirement savings, it’s important to understand the pros and cons of taking a loan. The following resources are designed to help educate you and your employees about workplace plan loans.

Resources for Employers:

for Plan Sponsors
Workplace Loan Program Campaign: Designed to help minimize the impact of workplace savings loans, “distressed” and “stressed” active participants with a loan receive annual touchpoints throughout the lifecycle of their workplace savings loan to help them evaluate their financial situation and prioritize actions to attain future goals

Persona	Plan hardship withdrawal within 12 months	Deferral Rate (includes employer contribution if applicable)	Loan amount relative to account balance
Distressed Loan Taker	1 or more	Greater than zero, but less than or equal to 5% or Not contributing	Greater than 50%
Stressed Loan Taker	N/A	Greater than 5% but less than 15% or Deferring 0% but have contributed between $2,700 and $9,000	Less than 50%

Note, this message is based on the first/oldest loan (if more than one loan is outstanding) until that loan is paid off. Highly compensated employees and those who have met the annual 402g limit are excluded.

Preview the four anniversary, and one congratulatory loan payoff emails: SAMPLE COMMUNICATIONS

Resources for Employees