A retiree benefits option all firms can afford
Even if your firm can’t afford to offer a traditional retiree benefits package, there is something you do. And it’ll likely boost your ability to attract — and retain — top talent.
It’s a new retiree-benefits trend that’s starting to catch on among companies. Basically, instead of traditional retiree benefits, companies will contribute added funds to an Health Reimbursement Account (HRA) or a Health Savings Account (HSA).
Retirees can then use these extra funds to buy healthcare coverage on their own. A defined contribution approach also gives retirees the freedom to choose their own plan, instead of the one or two plan options employers tend to offer.
In addition to choosing between regular insurers, retirees will also have the option of purchasing health care through a state insurance exchange in 2014.
And even the smallest employers can take part in this retiree option, by making small contributions to employees’ coverage. Companies don’t have to fully fund workers’ coverage with a DC option — and even a little bit helps workers prepare for retirement.
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