Technology in Total Rewards

Retirement Plans

Defined benefit and defined contribution plans require little in the way of investment for an organization to provide online access for employees to manage their accounts. Employees want employer-sponsored programs with the same level of access and control that retail products offer by having functionality like selection of funds or types of investments, allocation, retirement modeling, and integration with personal financial products.

Employees today want a defined contribution plan that makes it easy for them to:

• personalize their plans to address their needs as investors and administrators
• have access to real-time account information
• automate time-consuming administrative processes
• have access to a broad range of investment choices, advice, and online benefit estimates
• access traditional support, such as customer service numbers for technical assistance and plan design consulting

Online Retirement Plan Advantages

Most 401K plans provide online administration of retirement accounts, which provide these benefits to employers:

• Cost savings: Administration of plans is less labor intensive. It requires fewer people to service employees and communication costs less.
• Time savings: Self-service online platforms save Human Resource staff time by allowing employees to answer their own questions. These platforms have also resulted in more accurate and timely transactions.
• Tracking: Online retirement plans also allow employers to track investment trends. This helps the organization keep up with the needs of employees and determine training to help them manage their investments.
• Communication: The biggest payoff to employers that use online administration of retirement accounts is the ease of communicating information between the three parties involved, the employer, employee and fund administrator.

While integrating AI into retirement plans is still in its infancy, it has great potential to make retirement plan management easier and more understandable. For the employer, it could perform tasks like non-discrimination testing; for plan participants, sophisticated chatbots could educate them about their plan, act as an advisor for selecting mutual funds, and send them personalized messages about their plan performance.