T. Rowe Price, a global investment management firm and retirement planner, has created a tool that personalizes target-date investments for individual participants, the firm announced.
The Personalized Retirement Manager is the next step in T. Rowe Price’s evolution of its target-date offerings, said Wyatt Lee, head of target date strategies at T. Rowe Price. Lee’s team manages $464 billion in target date portfolios.
“We want our target date funds to evolve and we are always looking for more options that we can provide to retirement plan sponsors,” Lee said. “This is the next evolution in the services we offer and is a first-of-its-kind personalization tool in the industry.”
The Personalized Retirement Manager is an added benefit employers and other retirement plan sponsors can add for their employees who are participating in defined contribution plans such as 401(k) plans, he said.
The Retirement Manager software incorporates information on a participating employee from existing recordkeeping sources, he said. Then the employee can add whatever information he or she desires. The retirement plan is then rerun and the program develops a personalized plan for that employee.
The Retirement Manager was developed by T. Rowe Price when it learned from plan sponsors that personalization of portfolios was desired, Lee said.
The employee can update the information or change retirement goals whenever he or she wishes and the program will provide a new glide path to retirement based on the new information.
“Participants have the flexibility to engage as little or as much as they like; and the more they engage, the more personalized their experience will be,” T. Rowe Price said.
“There is growing interest in the defined contribution industry around personalization, as well as general acceptance that personalized strategies that incorporate an individual’s financial realities can offer value and potentially improve outcomes,” T. Rowe Price said in a white paper that accompanied the announcement of the Retirement Manager.
Jessica Sclafani, global retirement strategist at T. Rowe Price and author of the white paper, said in a statement. “While target-date solutions and personalization typically exist separately, the Personalized Retirement Manager combines the two. Our goal is to help participants feel more confident that their investments are aligned to their unique circumstances and long-term goals.”