Putnam Investments has launched an online tool for 401(k) plan participants that will calculate how much they can expect to receive in monthly retirement income after they leave the work force.
The firm will make the tool available to financial advisers within three months, Jeffrey Carney, senior managing director, head of global marketing, products and retirement at Putnam, said in an interview at Putnam’s Retirement Income Summit at the Four Seasons Hotel New York this morning.
Unlike tools that require investors to input all of their data in multiple steps to figure out what they will need to save for retirement, Putnam’s Lifetime Income Analysis Tool enables participants to go to its plan participant website and immediately see a monthly retirement income statement based on their current savings plan and account balance, according to Mr. Carney.
“Every time a participant logs in to the site, they will see their account balance as retirement income,” added Ed Murphy, managing director, head of defined contribution. Participants then can play with different sliding rules to see how it would affect their retirement income if they increased or decreased their 401(k) contribution rate and their age of retirement.
Since the tool is integrated with its 401(k) plan sponsors record-keeping systems, it will be more effective in helping participants take actions than other online services, said Dallas Salisbury, president of the Employee Benefit Research Institute.
“This tool has the ability to change how much someone is contributing to their plan in three clicks,” Mr. Salisbury said. “Last time I changed something in my 401(k) plan, it took 21 clicks.”
Jessica Toonkel Marquez is a reporter at InvestmentNews, a sister publication of Pensions & Investments.