Technology has revolutionized the way industries work, and the retirement plan sector is no exception. In recent years, there has been a shift in consumer expectations, and the demand for personalized services is growing. Studies show that 80% of customers patronize brands that offer personalized experiences.

Hyper personalization takes the experience a step ahead with the use of technology. It involves using technology to create a personalized experience for each plan participant. Combining behavioral and real-time data extracted from multiple channels and touchpoints help in creating a highly customized communication strategy.

Hyper-personalization in the retirement plan industry

Plan administration service providers aim at helping plan sponsors to maximize participant engagement and drive desired outcomes from their 401(k) plan. Besides increased plan participation, they target higher contribution rates with an uptick in retirement readiness.

PIMCO Consultant Survey shows 76% of plan sponsors are inclined to retain their retiree assets even after they leave the workforce. Personalized solutions are becoming recommended for 80% of aggregators and 65% of large institutional consultants.

They combine industry expertise and technology solutions to share personalized advice with plan participants. Prioritizing financial wellness, they send custom communication to each participant based on their current needs and behavioral prompts.

The data that empowers plan administrators is derived from the participant’s activity across various platforms, including social media. It lays the foundation of hyper-personalization as the individual receives the right communication at the right time.

Why does hyper-personalization matters?

The US retirement market is undergoing a generational shift as baby boomers begin to retire and millennials surpass them as the new generation of workers. Research shows that Millennials are more tech-savvy than Gen Xers and Baby Boomers. A study also suggests that 77% of Millennials and Gen Zs prefer self-service options.

These changes will have significant implications for plan sponsors and administrators, as they need to ensure that their retirement plans adequately meet the needs of both generations. They should consider offering flexible retirement options that allow plan participants to customize their accounts based on individual goals. Providing real-time financial advice and personalized financial education is also essential. It will help them make the best decisions by analyzing all available options.

Younger generations demand a more dynamic approach to retirement planning. Plan administrators must look beyond traditional solutions to remain competitive and responsive in the ever-changing economic landscape. They must embrace hyper-personalization to tailor their offerings to the needs of each participant. By utilizing behavioral prompts, data analytics, and custom communication strategies, plan administrators can create a unique experience for every participant.

Delivering the hyper-personalized experience

The journey to hyper-personalization starts with a deep understanding of the participant’s goals, needs, and preferences. Technology helps in making the journey smoother for all parties involved.

Plan administrators must be prepared to adjust their service delivery models according to the demands of the hyper-personalization model. It provides options for personalized advice, digital onboarding, automated investment recommendations, Robo-advisors for real-time guidance, and other tailored services.

Employees are looking for retirement plans that address their individual needs and expectations. Plan administrators can offer the experience by gaining data-driven insights to provide an engaging user experience coupled with comprehensive financial guidance.

Cloud-native platforms like CORE by Congruent Solutions help plan administrators with automated data collection, analysis, and delivery of personalized advice in an integrated experience.

Integrating data from multiple sources allows a plan administrator to track individual behavior over time, making it easier to target participants with relevant messages and offers. Automation tools help customize communication for each participant and automate follow-up reminders.

Get in touch with our team today to know how Congruent Solutions can help you reduce costs, increase efficiency, improve customer service, and enhance participant engagement.

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