When asked what they hope to achieve in retirement, participants chose "financial security" (68%) over "financial freedom," (32%) illustrating their desire for a foundation of financial well-being. To many, this is a more plausible, realistic goal.

There has been a sizable shift in how participants wish to invest their retirement savings. Two times as many participants would choose an investment strategy that is goal-based (52%) over one that is focused on their risk tolerance (26%) or retirement year (22%).

"We have tested the language of retirement income programs and found that people seem to care primarily about two things – flexibility and reasonable cost," said Jenkins. "In 2022 we conducted 12 focus groups as part of a dedicated retirement income study. The most common word expressed throughout was'"flexibility,' while the features of retirement income programs (such as in-plan vs out-of- plan) were confusing to many.

"Another appealing concept was the idea that the plan can potentially offer better pricing for retirement income than participants can find on their own.  Participants weren't sure what a fair cost was for retirement income, but pricing over 1% seemed high to people. In focus groups, stating costs in terms of dollars was met with more enthusiasm than percentages.

Plan sponsors often state that offering retirement income options for retirees is the "right thing to do." Surveyed participants tended to agree, as over half (54%) of respondents said that having access to a monthly payout feature would make them feel better about keeping money in their employer's plan after retiring. Solutions that emphasize optionality, flexibility, and agility tend to be perceived as more impactful than those with a built-in or guaranteed income option.

Related: Annual 401(k) benchmarking audits: The best way for plan sponsors to avoid overpaying fees

The results of the survey also identified some specific language that resonates with plan participants and can guide plan sponsors as they craft their messaging. When asked to identify what they'd rather hear from their employers, participants overwhelmingly selected language that describes how their employer can "negotiate lower fees" over language that touts access to exclusive investment options.

Here's a collection of some words and phrases plan sponsors should use (or avoid) to better communicate with participants and describe their retirement

plan in a more positive, constructive light:

• "Risk reduction path" over "Glide path"
• "Investment income" over "Nest egg"
• "Flexibility for short-term needs" over "Liquidity"

"There are many words and concepts that appeal to all age groups," said Jenkins. "Growth, for example, is one of the most powerful words we have ever tested and works across generations. Additionally, plan sponsors can reach different generations by including language that has particular appeal with each group.  For example, we found that:

• "Older participants typically have higher balances and are more concerned with cost efficiency.
• "Millennials place a higher value on convenience and personalization than their Gen X and Boomer peers.
• "Younger participants also tend to have a more non-traditional view of retirement.  Emphasizing that saving now affords more freedom later to pursue life goals is a good way to connect with that changing view."