The economic downturn, sometimes called the Great Recession, hascaused a lot of people to ask a lot of hard questions. If I getlaid off, will I be able to get another job? Should I let my homego back to the bank? Have I been living beyond my means?

Tough questions, and tough answers.

But another side effect of 2008 filtered over into retirementplanning. Millions of American workers saw their retirement plansdecline because of a nose-diving economy. Some rode it out. Otherspanicked. Now that the country is several years removed from theworst (though it might not seem like it), there are seriousquestions circulating over who’s responsible for retirementplanning. Obviously, everyone in the work force should plan forretirement. But employers that offer retirement plans also arepartially responsible for an employee’s retirement planning, andthey have to do so with the employees’ best interest in mind at alltimes.

Welcome to fiduciary responsibility.

“From a fiduciary standpoint, the only legal requirement is theyact in the best interest of participants,” says Marcy Supovitz, aprincipal with Boulay,Donnelly & Supovitz Consulting Group in Worcester, Mass.“There’s no legal requirement they offer anything at all. If theydo, there’s no requirement under the law they do anything specificto affect the outcome. From the philosophical side, obviouslythere’s a growing body of support for paying a lot more attentionto outcomes in these plans. And that’s become a much more talkedabout issue in the past couple of years.”

Over the past few decades, there’s been a shift away fromdefined benefits plans to defined contribution plans.

Getting help

At least one company will help organizations with fiduciaryresponsibility.

TheStandard of Oregon, based in Portland, Ore., on March 1 willlaunch an enhanced fiduciary offering through a subsidiary calledStandard Retirement Services, Inc. The crux of the offering is thatThe Standard agrees to take on fiduciary responsibility from theplan sponsor. While executives with the company say therelationship isn’t new to the industry, they are among the first toformalize it in writing.

That means The Standard will take on many of the actionsrequired of plan sponsors including determining eligibility,approving distributions and loans, adjudicating hardshipwithdrawals and distributing required communications toparticipants.

“As a sales guy, I see it as a great opportunity,” says DanHall, vice president of retirement plan sales at The Standard.“I’ve met with some brokers and they’re excited … with the wholelitigation tendency of retirement plans, there’s a lot of roomthere for 401(k) sponsors to protect themselves,” Hall says.

From a broker or vendor perspective, the largest challenge isgetting employees to become participants in their organization’sretirement plan. Sometimes, that’s hard. Some younger employeesaren’t thinking about retirement. Other employees are simplyspenders, not savers. Still others may feel a bit of concern aboutinvesting their money in a volatile market. In fact, there’s agrowing field of study called behavioral finance dedicated tounderstanding why people make economic decisions.

All these factors can play into participant apathy towardretirement planning, and that leads to inaction, which is probablywhy millions of American workers aren’t going to have enough tomaintain their standard of living when they decide to retire. Butthe industry has developed a few key strategies to helpparticipants.

Automatic enrollment

Over the past few years, automatic enrollments have grown in themarketplace. In an automatic enrollment situation, a participant isautomatically enrolled in the organization’s retirement plan. Thatmeans participants start off paying into their defined contributionplan or their pension. Automatic enrollment means the employee thenhas the responsibility to opt out.

Pete Welsh of OneAmerica of Indianapolis,says automatic enrollments have evolved to include more elaboratefeatures, such as auto-escalation, which automatically increases aparticipant’s contribution over a period of time.

But Welsh also said most plan sponsors would still prefer to gowith an effective communications strategy to drive enrollment.

“Many plan sponsors recognize they don’t have a fiduciaryresponsibility to get people to retirement, but they would at leastlike to,” Welsh says. “We’ll tell the plan sponsor to do a gapanalysis and we’ll provide the web tools and the calculators. And,if the employer will give us e-mail addresses—fabulous.”

Engaging participants

Beyond automatic enrollments, getting participants and keepingparticipants engaged reverts back to tried and true methods, wherethere’s still room to get creative.

Matt Larmann, president of Larmann Financial Corp. ofCincinnati, mixes low-tech and high-tech solutions to communicatewith employees and participants. Larmann’s company stands by thebreak-room meeting, where employees interested in participating inthe retirement plan can have a face-to-face meeting with someonefrom his firm and talk over the products offered.

But Larmann also emails video clips to participants once they’veenrolled. The roughly two-minute clips allow participants to learnmore about their retirement planning options in a way that’s notintrusive and in a manner that’s conducive to their schedules.

Larmann also discloses all of his fees to plan sponsors andparticipants so they see they’re flat and there’s no reason for himpush one investment over another. In fact, everyone knows how muchmoney’s he’s making when he’s selling retirement plans.

“Bottom line, these planned sponsor employers are doing thisbecause they’re trying to help their employees and feel a sense ofresponsibility to their employees,” Larmann says. “It’s hard togenerate interest. That’s our largest challenge—to keep themengaged and focused.”

In terms of engagement, Joel Mee of The Standard points to theirMainspring Managed product, which relies on studies ofbehavioral finance to get people to start planning for retirement.Within this product, Mee says, participants can get customizedadvice for their retirement plans.

For instance, Mainspring Managed will tell participants how muchthey should save at what age. His company crunches the numbers soparticipants can see what they have to do.

“For a lot of people it’s an aha moment,” Mee says. “It’s thefirst time real numbers have been put in front of them.”

Ultimate responsibility

In the end, however, the ultimate responsibility for retirementplanning lies with the participant. Fiduciary responsibility onlyextends to the plan sponsor and vendors who make investmentsavailable. The participant has the final authority over where themoney goes in a defined contribution plan. While leaders inCongress are tinkering with how to fund retirements, the power isstill in the hands of the individual. Any financial planner andmost advisers will tell participants some basic rules forretirement planning.

Contribute to your retirement plan. In definedcontribution plans, employers often match a percentage of theemployee’s contributions. Failure to contribute enough to qualifyfor the match is like leaving money—and part of yourcompensation—on the table.

Start early. The earlier participants startsaving for retirement the easier it will be later in life.Participants are often concerned with maintaining their standard ofliving after they retire. Starting early helps make thateasier.

Get involved. Talk to your plan sponsor, brokeror representative. They really are there to educate. In fact, it’sthe law.

“A lot of people have not seen from prior generations what canhappen if they don’t start saving early for retirement,” Supovitzsays. “It was never viewed as personal responsibility in pastgenerations. In the next generation, it will be far more prevalentthat the responsibility lies with them.”

[Read "Doesretirement income even exist anymore?"]

Nathan Solheim is a Denver-area writer. He can be reached [email protected].