Retirement isn’t something that the young think about. Neither is investment. However, as we age, we devote more thought into these things as our age begins to catch up to us. Our own mortality reminds us that we need to plan for a time when we can’t rely on our bodies to make us money, and relying solely on social security is no longer an option if we want to live comfortably.
Fortunately, some employers are helping their employees plan for their retirement by encouraging them to do more than just pay taxes – they also encourage them to deliberately invest a portion of their income. Such is the case with Ron McColly, CEO of McColly Real Estate and his independent contractors.
“Saving is a habit, and a lot of times, a good habit is as hard to break as much as a bad habit,” said McColly. “This includes getting into the habit of saving at a young age. Time is the number one thing that will make you wealthy.”
McColly has, for the past several years, given his agents the option of enrolling in his Performance Plus program. This is a “non-qualified deferred compensation plan” that McColly agents can choose to participate in.
“The purpose is to have the agents elect a certain portion of their commission income, and to defer that income to a later date, in this case, 5 years,” stated Matt Radencic, Director of Finance for McColly. “This money can grow in one of three ways: Berkshire Hathaway Stock, S&P index, and a ten-year Treasury Note. The agents have the choice.”
Today’s celebration was the issuance of that deferred payment for those that chose to join. So, for the 150 agents that attended and invested money in 2012, $441,078 was distributed among them.
“Because real estate agents are independent contractors, we can’t offer them the normal types of benefits of traditional employers,” stated Radencic. “So, this is a real good way to help them grow wealth by matching 50% of their money, up to $1500 per year.”
No other real estate agency in the area does this type of thing for their agents. That makes McColly unique. And this type of care for their independent contractors goes a long way and is well received.
“This is my third year to receive a check. My hope is that one day we have 100% participation,” said Wendy Embry, Manager for McColly’s Schererville Office. “I’ve seen great fruits and rewards from it. I do the maximum amount that I can invest. I’m very appreciative because other companies don’t do anything like this.”
McColly believes in the power of saving and investing so strongly that he encourages his agents to invest in Berkshire Hathaway, a company he’s personally been investing in for years.
“Someone gave me a book in 1987,” remembered McColly. “It was a book on Buffett. So, when I read it, I started studying him, and have for the last 14 years, before I implemented this program. The reason is that with Berkshire, I’m so sure of the investment potential going forward, and the big thing, is the downside risk is so small with Berkshire Hathaway.”
McColly may be the leader in real estate in many areas, but they’re proving that they value their independent contractors more than any other local company. By encouraging them to take care of themselves and matching investments, McColly is positioning themselves for growth and security for years to come.