3 Effective Key Employee Retention Strategies: A Series
More than 47 million Americans left their jobs in 2021 — a phenomenon dubbed “The Great Resignation.” In this unusually challenging job market, a traditional employee benefits and compensation package may not be enough to keep the most talented employees from looking elsewhere.
The problem is especially significant for smaller, closely held businesses. Often, just a handful of people have an outsized role in keeping the business profitable. These employers must be more creative and more flexible in crafting benefits targeted to retain and reward those key contributors.
There are several well-developed key person retention strategies available to meet this need. Our Advanced Markets team has worked with hundreds of advisors and their business-owner clients to design key person benefit plans.
In our experience, some of the most effective plans are those that leverage the unique characteristics of life insurance.
Over the next few months, this blog series will introduce three of those strategies — strategies business owners can use to reward and retain their most valuable employees. We’ll discuss the characteristics of a good retention plan, and we’ll identify the factors that may cause an employer to prefer one type of plan over another. For each plan, we’ll describe how it works, how it is implemented and how it will be administered. The three insurance-based key person strategies we’ll cover are:
- Executive bonus with option to add restrictions
- Endorsement split dollar
- Employer funded deferred compensation
Of course, if you have a client in mind, you don’t have to wait. The Advanced Market team is ready to create solutions for individual situations now. Just reach out to our team at (800) 589-3000.
RELATED BLOGS IN THIS SERIES:
Strategy #1: Employee Retention Strategies: Executive Bonus with Added Restrictions
Strategy #2: Employee Retention Strategies: Endorsement Split Dollar Arrangement
Strategy #3: Employee Retention Strategies: Employer Funded Deferred Compensation