Contributor Report

The purpose of this report is to interpret data normally contained in up to twenty quarterly statements and deliver it in a way that enables participants to answer their most pressing questions about their retirement account. Its simple three-step process enables participants to achieve adequate benefits.

Step 1 lists the data being used, calculates the expected return to be used in the analysis, and illustrates the expected income that might be produced from all known sources, including Social Security, defined benefit, profit sharing, money purchase and after-tax sources, then compares it to minimum and full income replacement goals. The current account balance is compared to the required account balance to illustrate any expected current funding gap.
Contributor Report (continued)

Step 2 determines the individual’s investment performance compared with expected performance, both on a quarterly and compounded return basis. This is critical information because if the strategy’s contribution level depends on a specific rate of return and the actual return is lower, an increased contribution will be required to meet the goal.

Step 3 gives two suggestions to close any funding gaps to achieve the next minimum or full funding retirement income goal. Option 1 typically has a higher required return (and risk), but lower contribution than Option 2 and Option 2 typically has a greater contribution than Option 1, but lower required return (and risk). By giving participants two complete solutions that attain a goal, we eschew risk tolerance questionnaires which guide participants to choose an investment without knowing the correct contribution.
Contributor Report (continued)

Our Quick Enrollment form acts as a call to action and makes it as easy as possible to choose a complete solution that could achieve the next goal. An increasingly popular approach to encourage new participants is "easy enrollment", where a simple, postage-paid postcard is sent to new employees and to employees who aren't contributing. After signing the card and returning it, the employees are enrolled in the plan — typically at a 3 percent contribution into a default investment fund.

The Retirement Analyst takes this good idea a step further. Since we know two solutions for each participant that can provide an adequate benefit, our Quick Enrollment form enables employees to check the box for a solution that can accomplish a goal. For plans that require changes through a web site, this form can be eliminated from the report.

Contributor Report
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PMB 116
Long Beach, CA 90802

Office: (562) 987-2255
Fax: (562) 987-2257
bcorrin@retirementanalyst.com