For a long time now, plan providers and third-party administrators have been doing the bulk of the heavy lifting when it comes to managing participant census and retirement contributions. This essentially means hiring more payroll clerks and customer support staff to verify data and coordinate operations. This, in turn, puts an additional financial strain on the participants, as most plan expenses are factored into the retirement plan.
This is where the self-service portal (SSP) comes in. It turns the table by stripping frills and associated costs and enabling sponsors and participants to take care of basic tasks on their own, without, of course, weighing them down.
Why is self-service important?
The self-service portal makes plan sponsors and participants self-sufficient enough to manage their data without constantly reaching out to TPAs or plan providers and going back and forth. This has the dual advantage of empowering sponsors and participants and significantly reducing the burden on time, cost, and resources in more ways than one.
What can be done with the SSP?
Using the SSP, sponsors can, periodically, manage the census demographic information. Census management involves managing data such as social security number, date of birth, beneficiary, and other data points relating to the employee. The SSP also lets the sponsors do eligibility enrolment and processing, run contributions for each employee, deduct money from their paychecks, and contribute it to the retirement plan.
Participants, too, are emboldened in several ways. As they have access to their demographic data, they can make simple changes related to phone number or address and make beneficiary changes on the portal. They can make minor tweaks in their enrolment and define their investments: how much they want to contribute, how to contribute (pre-tax or after-tax), what investments to park their money in. They can also do transfers, reallocation of money, requests for withdrawal or loan, apart from account balance queries and reviewing accounts, reports, and financial statements.
Benefits of SSP
The SSP benefits plan providers, sponsors, and participants alike.
- The SSP takes a considerable burden off TPAs and plan providers. It reduces the hiring of additional resources and offers an immense economic advantage for plan providers and TPAs. Significant time spent on routine tasks is also saved. This lessens the load on the HR department of these firms.
- Sponsors, too, save outsourcing costs and time by managing data on their own instead of running to vendors or plan providers for hygiene transactions. They also enjoy the benefit of reduced paperwork.
- Participants save time as they do not have to wait for help for simple tasks. It is a matter of just logging in and updating. As simple as that! The additional financial strain we talked about earlier is also absent thanks to self-servicing.
If the portal is clunky and not easy to use, sponsors and participants could view it as a hindrance. Then the entire idea of self-service falls apart. So, it is crucial for the portal to be user-friendly and offer an experience that is easy, compelling, and convenient.
The SSP has to be multidimensional, interactive, and customizable. It should offer a wizard-like interface or a chat engine that takes users through any task, thus enabling them to do it efficiently. Support features such as FAQs, how-to videos, and online tutorials with images/screenshots will make the portal agile and informative. The portal must also provide a calendaring system that prompts users of pending or upcoming tasks. Other features could include auto error correction, auto-mapping, and voice support.
AI and machine learning could be leveraged to make all these possible and enhance the user experience.
Sponsors and employees may have to be educated on the self-help features of the system, as some of them may be reluctant or not confident about using the portal on their own. The information available on the portal must be frequently updated. Outdated data defies the very premise of a self-service platform. There is also a need for heightened security as these portals deal with confidential data.
These efforts will increase the adoption of self-service platforms in the retirement industry and empower users in a big way.