Products April 6, 2017

AXA Offers New Solution for DC Marketplace

The solution is an open architecture investment program with intuitive technology that allows for ease of set-up and ongoing management for plan sponsors and participants.
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AXA has launched a new solution for the defined contribution (DC) marketplace: AXA Retirement 360, an open architecture DC mutual fund program designed for 401(k), 403(b), 457(b) and 401(a) plans.

AXA Retirement 360 features access to the broad mutual fund marketplace as well as a non-mutual fund option for retirement certainty with the AXA Fixed Account through a group fixed annuity from AXA Equitable Life Insurance Company, which offers principal protection, liquidity and a guaranteed minimum interest rate on savings.

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AXA’s streamlined, intuitive website and dedicated team of retirement professionals provide the tools and assistance employers need every step of the way. While a dedicated onboarding specialist manages the plan’s setup and transition via an all-paperless process, plan sponsors and their advisors can track onboarding progress with complete transparency through real-time updates so they always know the status of plans in progress.

Kevin Molloy, head of AXA Retirement Plan Services, based in New York, tells PLANSPONSOR, “This is quite a bit different from our traditional offering. Traditionally, we have offered a group annuity platform across the different markets we serve. We saw demand for a new kind of experience, and our research targeted specialist advisers, consultants and plan sponsors to identify what was missing.”

Molloy says one major pain point for plan sponsors was with initial onboarding of new plans. “We addressed that by integrating human touch with technology. There is a human hand holding plan sponsors and advisers through the process, a paperless experience with which plan sponsors can complete all documents electronically, and an online tracker to let plan sponsors and advisers follow the progress of the plan setup,” he says. “That, in addition to fiduciary protection, are two real components to meet the needs of plan sponsors.”

The fiduciary protection of which Molloy speaks is powered by Wilshire Associates; plan sponsors can choose either 3(21) or 3(38) fiduciary services. Molloy says AXA has partnered with Wilshire Associates for more than five years now.

For employees, AXA Retirement 360 provides tools and resources, so employees can educate themselves at their own pace, throughout the enrollment process and beyond. They can use a guided, jargon-free enrollment tool and live chat option to make decisions with confidence.

In addition, there is a simple investment selection process, with options to select funds based on employees’ retirement date or risk tolerance, as well as the option for the AXA Fixed Account, tailored for those concerned with principal protection or those who want a degree of retirement certainty.

Molloy explains that the group annuity provides a guaranteed rate of accumulation and interest rate. When participants leave the plan, they can take their balances—the vehicle is liquid just like any other fund option—or they can annuitize the balance in the Fixed Account, which would entail being issues a fixed immediate annuity.

For more information about AXA Retirement 360, please contact your AXA adviser.

Products April 6, 2017

Emotion Plays a Role in Measuring Financial Wellness

Fidelity Investment’s new assessment will take into account how people are managing their money as well as how they feel about finances.
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All over the country, financial troubles are keeping working Americans up at night, and it is even damaging their mental health. According to a recent study by Fidelity Investments, 51% of people say they are just breaking even or spending more than they earn per month.

To reverse this trend, the firm is releasing its Fidelity Financial Wellness Score. This assessment helps people measure their financial health, while identifying their most pressing financial flaws and how to address them. Fidelity says this tool goes beyond gauging the key aspects of money management, but it also takes people’s emotions into account.
 
“The score is based on what we believe are the four key domains of Financial Wellness: budget, debt, savings and protection, all of which are equally significant,” says Jeanne Thompson, senior vice president of thought leadership at Fidelity Investments. “The score is unique in that it accounts for objective criteria, such as how much savings a person has and how they manage expenses, and subjective criteria, like how they feel about their finances. We believe Financial Wellness means being well and feeling well.”

The financial wellness score ranges from zero, representing extreme financial stress; and 100, representing excellent financial health.

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Although the tool will be available to employers in the summer, Fidelity has conducted a survey of more than 6,000 people to determine how well they are doing in each of these four money management categories as well as how they feel about each.

The results indicate that 14% are financially “excellent” (a score between 81 and 100), 37% are “good” (a score between 61 and 80), 33% are “fair” (a score between 41 and 60) and 16% “need attention” (a score between 0 and 40).

The survey also found that Generation Xers seem to be the most financially stressed with 52% saying they feel neutral or negative about their debt; meanwhile, 65% of Boomers feel like their debt is manageable.

Not surprisingly, the survey found that money tends to bring happiness. Fifty-seven percent of those surveyed said they could not be happy unless they are financially secure. Millennials are more likely to feel this way than other generations, with 66% agreeing with the statement. The study also indicated that planning for the long-term has its rewards. Those planning for more than 10 years ahead tend to be in excellent financial health, while those planning for the next few weeks are in need of the most attention.

Moreover, the survey found that women are twice as likely as men to feel worried or sick about their financial situation.

“When the Financial Wellness Score is made available this summer as part of Fidelity’s Money Checkup, it will be a wake-up call for some employees and for others it will bring peace of mind,” says Thompson. “The score will bring clarity to where they stand financially and put a spotlight on next steps. We’ll be working with employers on how they can incorporate this Financial Wellness measure as part of their strategy to give employees the financial confidence and control they need.” 

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