Helping Financial Professionals Ease Plan Sponsor Retirement Worries
New Replacement Ratio Tool from The Principal Measures Retirement Plan Success
(Des Moines, Iowa) — As the market downturn continues to zap retirement account values, more and more plan sponsors worry whether their employees will be financially ready to retire.
Financial professionals can now ease their worries with a new tool from the Principal Financial Group® to measure retirement readiness.
The Replacement Ratio Tool for Defined Contribution Plans goes beyond typical measures of retirement plan success. By entering a few pieces of data, financial professionals can quickly and easily show clients what percent of employees are saving enough to maintain their standard of living in retirement.
“Plan sponsors too often judge the success of their retirement plan by the percent of employees who participate or their average salary deferral rates. These measures alone don’t tell the full story. A successful plan helps employees understand how much they need to save now to help live comfortably in retirement,” said Brian Walker, vice president, Business Development, The Principal®. “Financial professionals who can provide this value-added service have an edge with clients and prospects.”
The tool, designed expressly for financial professionals to use with prospective clients, provides results in a simple, easy to understand format to show:
- Overall replacement ratio percentage of all plan participants
- Overall replacement ratio percentage of participants on track and not on track for retirement
- A breakdown of those participants within each replacement ratio range
- Percentage of participants on track and not on track by age and salary
The Principal will then team with financial professionals to introduce ideas to help get participants on track and help the plan be more successful.
About the Principal Financial Group
The Principal Financial Group® (The Principal®) is a leader in offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement and investment services, life and health insurance, and banking through its diverse family of financial services companies. A member of the Fortune 500, the Principal Financial Group has $247.0 billion in assets under management and serves some 19.1 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit www.principal.com.