Ed Dressel likes what he’s seeing in the retirement plan space, and specifically, the innovation recently introduced by his own firm RetireReady Solutions. The Oregon-based retirement readiness software provider has recently added new features, including auto-escalation, to aid in participant engagement, “not only in their current paycheck but as a solution,” Dressel said Sunday afternoon from the floor of the Outcomes Conference 2019 in Denver.
“Rather than saying you need to go from 2% to 12%, you can go from 2% to 5% and then add increments after that. And the advisor can configure how those steps are taken. They can also import census data and create a customized participant report.”
Arguing that most advisors are passive when it comes to some of the most important questions for participants, “that’s why the participation level isn’t as high as it could be,” he noted. “Advisors are not answering their participant’s key questions. They’re instead talking about fees, and funds and their credentials. They’ve already been cleared the plan sponsor, but they’re still stating off by talking about themselves.”
The question for discussion
The question they should discuss, according to Dressel, is how participants get to retirement.
“Most advisors will send passively send participants to a portal, but they don’t know if the date is entered correctly by the participant, and the participant is unsure if they entered it correctly. But if they can map out how that participant can get to retirement that day, in that meeting, it’s incredibly powerful and engaging for everyone in that room. The product now specifically lets the advisor do that.”
Called The Retirement Analysis Kit (TRAK), it’s available in a Windows desktop version and an online version.
“Participants might say, ‘Oh I can’t do 12 percent.” Well, they probably can go to 5 percent today and then do 2 percent next year and so on. I call it an engaged escalation rather than a passive escalation. They know why they’re doing it. They understand it and they have a vested interest in it, as opposed to ‘I don’t know what’s going on they’re just taking money from my paycheck.’
“It’s not set it and forget it; it’s set it and watch it and be engaged about the process.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
