With the Batch Processing tool, you can quickly give retirement plan participants a meaningful report illustrating their contributions and their impact on retirement. Census data can be imported and reports can be generated with just a few clicks of the mouse button.
TRAK's Batch Gap report provides a one-page gap analysis report for clients to examine how well their retirement is funded—and how closing a potential shortfall will impact their take-home pay. The chart at the top allows them to see their progress in funding retirement in a meaningful way.
Similar to the Contribution Analysis report, the Batch Gap report shows the client’s current paycheck and the proposed change to take-home pay (the value that means the most to the client).
Additionally, the bottom of the report presents options for funding retirement, including the cost of waiting before increasing contributions, retiring a year later, or if they have additional assets outside of their retirement plan.
For clients who are significantly underfunded, the calculation engine can be configured to automatically modify the scenario to reduce a shortfall. For example, it could increase the client’s retirement age until the increase in contribution falls within a specific threshold (the modified data is noted in a footnote). Similar functionality can be applied for overfunded clients.
The Batch Gap report provides a meaningful, quick assessment of how well a plan participant is funded for retirement and the available options for addressing the projected gap.
Using the Batch Gap and Contribution Analysis reports in combination provides an effective set of tools for helping advisors educate plan participants for retirement.
Opening Up Dialog
Using the Batch Gap and Contribution Analysis reports in combination provides an effective set of tools for helping advisors educate plan participants for retirement, helping participants understand why they need to increase deferrals. Additionally, because of the education they receive, participants will more likely disclose the retirement accounts they have elsewhere.Back to top.
TRAK’s Contribution Analysis Report starts by calculating a client’s paycheck (including tax withholdings), allowing a client to connect with the information being presented. It illustrates the impact of increased contributions on the client’s paycheck. The illustrated increase in contributions can be configured as needed, but typically a 2%, 4%, 6% increases in contribution is illustrated.
The report can illustrate how the increased contributions grow over time at various rates of return (e.g., 5 years, 10 years and at retirement).
Additionally, the report can illustrate the impact on the projected retirement account balance at retirement if the client should wait before increasing the amount of his or her contributions.
Finally, the report can illustrate the income stream from the projected account balances at retirement.
Some advisors have objected to the wealth of information provided in this report. Please note that the amount of information can be reduced. However, once advisors use this report, they often respond differently. Plan participants are able to understand the report because the calculations are based on their own paycheck. This helps them connect with the data and they quickly understand the other ideas that are being communicated.
The Contribution Analysis report is an excellent tool for an enrollment or re-enrollment meeting. It helps clients quickly comprehend the impacts of increasing contributions not only on their paycheck, but also in retirement.Back to top.