Research
Employees who are well taken care of are more likely to stick around and be productive. Photo: Pixabay

The Principal Financial Group recently announced the 10 Best Companies for Employee Financial Security for 2015. Why should you care about these 10 companies, none of which is likely to be your employer? Well, for one thing, learning how well some companies treat their employees can help you see how well your employer is treating you -- and perhaps advocate for improvement. It's also a good way for stock-hunting investors to assess candidates for their portfolios.

First, though, let's review the winners:

  • Alterman Group
  • Atrion
  • Customized Energy Solutions
  • Fishbowl
  • Hudson Valley Federal Credit Union
  • International Foundation of Employee Benefit Plans
  • MSU Federal Credit Union
  • MZA Associates Corporation
  • USD Group LLC
  • We Insure Group

What's that? You haven't heard of any of them? Well, they're not exactly household names -- in part because they're a bit on the small side, with between five and 1,000 employees. For example, Atrion, based in Warwick, Rhode Island, recently had fewer than 300 workers. It's a business-focused IT service provider. Fishbowl, based in Orem, Utah, is a software developer with approximately 100 workers.

Quality

Image: Pixabay

How does your company stack up?
Some of the things that these winning companies are doing can help us see how our own employers compare. They might even help us assess our own money management.

For example, Christopher Thiel, executive vice president and CFO at Alterman, has said, "We are able to offer 100% health, dental, and vision because of our employee ownership. We offer 401(k) with a match to help our employee-owners achieve a diversified retirement portfolio, and our ESOP (employee stock ownership plan) has grown at a much higher rate than the S&P 500. We also offer very aggressive diversification within our ESOP to ensure our employee-owners do not have a concentration issue in their retirement savings."

A key plus for Alterman is that the company is helping its workers avoid dangerous -- and common -- mistakes: being underdiversified in general, or having too much of their retirement assets in their employer's stock. After all, your financial well-being is already dependent on your employer; having too much money in its stock makes you even more so.

The Hudson Valley Federal Credit Union helps its workers be financially healthy in several ways. Its 401(k) offers above-average matching, with the company matching 75% of the first 6% of salary that workers contribute. Thus, if you work there with a salary of $50,000 and you contribute 6%, or $3,000, to your 401(k), the credit union will chip in another $2,250. That's free money and gives you an immediate 75% return on your money. It's more typical for companies to match just 50% of employee contributions, with many doing less than that.

Some employer matches can be even more generous. MSU Federal Credit Union, for example, offers a 200% match for the first 5% of salary that employees contribute to their 401(k)s, up to a maximum match of $26,500, while Customized Energy Solutions matches 100% of the first 4% of employee contributions, up to a maximum of $10,500, and it also makes a fixed contribution of $6,000 to each employee's plan.

The Hudson Valley Federal Credit Union also offers a Roth 401(k), which gives workers the opportunity to accumulate a lot of money that they can eventually withdraw tax-free. It offers them discounted fees and interest rates on mortgages and other loans, too.

Images

Image: Barry Dahl, Flickr.

If your employer offers a Roth 401(k), consider participating in it. Roth IRAs are great, but they have a contribution limit of $5,500 in 2015 ($6,500 for those 50 or older), whereas 401(k)s permit much greater contributions -- up to $18,000 for most of us in 2015 and $24,000 for those 50 and up. According to Aon Hewitt data, only about 11% of employers offered the option in 2007, whereas fully 50% of them did in 2013, up from 40% just two years earlier. Recently, about 56% of 401(k) plans offered through Fidelity included a Roth option.

Best practices
You can assess how well any company tends to its workers' financial well-being by reviewing the list of best practices associated with the Principal Financial Group's top 10 companies. These include:

Best Practice

Percentage of Top 10 Companies Featuring This

Percentage of Companies Overall Featuring This

Having a defined benefit plan, such as a pension

40%

26%

Having a defined contribution retirement plan such as a 401(k)

100%

90%

Offering an employer match

100%

73%

Paying 75% or more of health insurance premium

93%

Less than 75%

Offering long-term disability insurance

100%

80%

Offering long-term care insurance

70%

32%

These, too, can help you see how well your employer is treating you.

Seek investment ideas among winners
Finally, when you see a list of companies that are serving their employees well, know that that's fertile ground for investment ideas. Inclusion on such a list doesn't guarantee a strong stock, but any company that offers good benefits is likely to have more satisfied employees who are therefore more likely to stick around.

"The most forward-thinking companies have made the connection between their employees' financial security and the success of their business," explained Principal Financial Group's Luke Vandermillen. "They understand that when employees are financially secure, they create an environment where employees can do their best work, which leads to gains in employee retention, productivity, safety, customer service, and profitability." 

Longtime Fool specialistSelena Maranjian, whom you can follow on Twitter, owns no shares of any company mentioned in this article. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.