1. Are Wells Fargo’s 401(k) Communications to Health Care Employees O(k)? Tuesday, May 15, 2007 Jennifer Cresap

2. Wells Fargo is more than just a bank Wells Fargo is more than just a bank It administers 401(k) Plans for 3,000+ organizations around the U.S. It administers 401(k) Plans for 3,000+ organizations around the U.S. –Its health care customers account for $5 billion of their $38 billion in 401(k) assets –Current average participation rate for health care employees in their organization’s 401(k) Plan is 59% Situation Overview

3. Wells Fargo’s communications team is an extension of their 401 (k) customers’ communications departments Wells Fargo’s communications team is an extension of their 401 (k) customers’ communications departments My goal is to develop communications strategies that help increase 401(k) enrollments and educate employees about the importance of saving for retirement My goal is to develop communications strategies that help increase 401(k) enrollments and educate employees about the importance of saving for retirement

4. Situation Overview Primary form of communications for health care customers in the past has been direct mail Primary form of communications for health care customers in the past has been direct mail Because direct mail is all we have done, and because results haven’t been measured, effectiveness is hard to gauge Because direct mail is all we have done, and because results haven’t been measured, effectiveness is hard to gauge

5. Importance of Issue With only 59% of health care employees participating in their 401(k) Plan, there is a potential of $4 billion in lost assets With only 59% of health care employees participating in their 401(k) Plan, there is a potential of $4 billion in lost assets With 41% of health care employees not participating in their 401(k) Plan, there are thousands of people not saving for their retirement With 41% of health care employees not participating in their 401(k) Plan, there are thousands of people not saving for their retirement

6. Research Question What is the most effective form of communications to health care employees about their organization’s 401(k) Plan? What is the most effective form of communications to health care employees about their organization’s 401(k) Plan?

7. Methodologies  Quantitative data: 8-question online survey  Sent to two groups as part of a stratified random sample:  Two Wells Fargo 401(k) Plan clients (100 surveys)  Three non-Wells Fargo 401(k) Plan groups (150 surveys)

8. Methodologies  Qualitative data: 5-question telephone interviews  Interviewed three human resource professionals in health care organizations that work with 401(k) Plans  Purpose: To get their thoughts on which communication method (direct mail, email, face-to-face, etc) is the most effective form of communication for their employees

9. Results 39% response rate (98 total survey responses) 39% response rate (98 total survey responses) –39 responses from Wells Fargo 401(k) Plan group –59 responses from non-Wells Fargo 401(k) Plan group

10. Results of the Online Survey How do you currently receive information about your organization's 401(k) Plan and other benefits? (Select all that apply). How do you currently receive information about your organization's 401(k) Plan and other benefits? (Select all that apply).

11. Results of the Online Survey Please rank the following ways you would prefer to receive information about your organization's 401(k) Plan. Please rank the following ways you would prefer to receive information about your organization's 401(k) Plan.

12. Results of the Online Survey Please rate the following statement: I find my organization's current communications about the 401(k) Plan satisfactory. Please rate the following statement: I find my organization's current communications about the 401(k) Plan satisfactory.

13. Results of the Online Survey What motivates you/would motivate you to join your organization’s 401(k) Plan? What motivates you/would motivate you to join your organization’s 401(k) Plan?

14. What communication approach(es) have worked most effectively for your employees in the past? What communication approach(es) have worked most effectively for your employees in the past? –The approach varies according to the health care organization and its employees  Sioux Valley uses a mix of email and direct mail, with a focus on humor and creativity no matter the medium  UWMF relies on direct mail  Methodist Hospital is still searching for the right mix Results of the One-on-One Interviews

15. Summary of Results Currently, direct mail is the primary form of 401(k) communications – but an equal number receive this information through e-mail or intranet Currently, direct mail is the primary form of 401(k) communications – but an equal number receive this information through e-mail or intranet Electronic delivery is the preferred form of 401(k) communications (48%), followed by direct mail (32%) Electronic delivery is the preferred form of 401(k) communications (48%), followed by direct mail (32%) Overall health care employees are satisfied or very satisfied with their organization’s 401(k) communications (57%) Overall health care employees are satisfied or very satisfied with their organization’s 401(k) communications (57%) A company match is the #1 motivating factor for joining the 401(k) Plan; seeing how much they need to save is #2; and hands-on advice/communication is #3 A company match is the #1 motivating factor for joining the 401(k) Plan; seeing how much they need to save is #2; and hands-on advice/communication is #3 Interviews with HR professionals indicated that the communication is customized differently by all organizations to fit needs and culture Interviews with HR professionals indicated that the communication is customized differently by all organizations to fit needs and culture

16. Answer to Research Question What is the most effective form of communications to health care employees about their organization’s 401(k) Plan? What is the most effective form of communications to health care employees about their organization’s 401(k) Plan? –Email is the preferred form of 401(k) communication – even though direct mail is the primary form of 401(k) communication –Little more than half (57%) are satisfied with current 401(k) communications –Each HR representative had a different perspective on what communication approach is most effective

17. Conclusion Direct mail is not always the answer Direct mail is not always the answer –Going forward, we must get to know employees, what motivates them, and what is the most effective way to reach them  Conduct needs analysis on an annual basis with health care clients to ensure we deliver 401(k) communications with impact  Set benchmarks and measure results of future communications to identify successes, as well as areas of opportunity, so we can build on them

18. Thank you for your time today! Any questions?