Retirement Plan Savings Rates Double for 401(K) Participants Using Schwab Managed Account and Advice Services
January 24 2005 - 10:00AM
PR Newswire (US)
Retirement Plan Savings Rates Double for 401(K) Participants Using
Schwab Managed Account and Advice Services SAN FRANCISCO, Jan. 24
/PRNewswire-FirstCall/ -- 401(k) plan participants save more when
they receive personalized advice, based on the first-year results
of Schwab Corporate Services' managed account and advice offerings.
Individuals using the services more than doubled their average
savings rate to 9.57 percent of eligible income in 2004. In
addition, 84 percent of these same individuals enrolled in managed
accounts that provide ongoing account monitoring and automatic
rebalancing. Schwab Corporate Services, a leading provider of
workplace financial benefits, offers personalized managed account
and advice services at no extra cost to 401(k) plans serviced by
Schwab Retirement Plan Services, Inc. (SRPS).* Participants have
access to personalized advice either online, by phone or in person,
including recommendations specific to the core investment fund
choices available in their retirement plan and specific recommended
savings rates. Participants also have the option to elect managed
accounts with annual rebalancing. The advice, including the managed
account feature, is provided by a third party, GuidedChoice(TM),
Inc., an innovator in the development and delivery of investment
advice.** "We know that when it comes to retirement planning, many
individuals aren't sure how much they need to save or how to
invest. We offer those answers and the opportunity to discuss them
with an investment professional. Clearly, many of our participants
prefer this type of one-on-one relationship. We're gratified that
our approach is encouraging them to take action," said Trish Cox,
chief operating officer for SRPS. Cox noted that previously, the
average savings rate for these participants was 4.57 percent, well
below the overall average for Schwab's 401(k) participants (7.15
percent) and the national average (7.0 percent).*** "Our goal has
always been to help plan sponsors get their employees to and
through retirement. By making the commitment to offer personalized
advice without charging additional fees, we broke new ground and
removed key barriers to effective retirement investing," said Jim
McCool, president of Schwab Corporate Services. "Our first-year
results only deepen our conviction that advice services should be
standard in every 401(k) plan." About Schwab Corporate Services
Schwab Corporate Services (SCS) provides services to retirement
plan sponsors and participants through Schwab Retirement Plan
Services, Inc. (SRPS), The Charles Schwab Trust Company (CSTC), and
Charles Schwab & Co., Inc. SCS also provides equity
compensation plan services and other financial and retirement
services to corporations and executives. SRPS provides
recordkeeping and related services with respect to retirement
plans. CSTC, a California state-chartered trust company, provides
trust and custody services to retirement plan sponsors. Charles
Schwab & Co., Inc. (Member SIPC) is a registered broker/dealer,
offering the Schwab Personal Choice Retirement Account(R) (PCRA),
as well as other brokerage and custody services to its customers.
These entities are affiliates of each other and are wholly owned
subsidiaries of The Charles Schwab Corporation. Total client assets
in employer-sponsored retirement plans at Schwab equaled $131
billion at the end of December 2004. The Charles Schwab Corporation
(NYSE / Nasdaq: SCH), through Charles Schwab & Co., Inc.
(member SIPC), U.S. Trust Corporation (member FDIC),
CyberTrader(R), Inc. (member SIPC) and its other operating
subsidiaries, is one of the nation's largest financial services
firms. (0105-3698) * "At no extra cost" means that there is no cost
for service outside the fees paid to SRPS and Charles Schwab &
Co., Inc. (CS&Co.) for recordkeeping and related services,
including trustee and custodial fees paid to The Charles Schwab
Trust Company. ** The GuidedChoice(TM) service and the investment
advice are formulated and provided by GuidedChoice Asset
Management, Inc. (GuidedChoice). GuidedChoice is not affiliated
with, nor is it an employee or agent of, CS&Co. or SRPS. The
GuidedChoice service is available to participants enrolled in plans
that use the recordkeeping and related services of SRPS.
Availability subject to regulatory requirements. Plan sponsors must
elect to make the GuidedChoice service available. Availability may
be limited due to plan type and plan provisions. Participant access
to the GuidedChoice service is facilitated through SRPS's
affiliate, CS&Co. Neither CS&Co. nor SRPS supervises, makes
recommendations with respect to, or takes responsibility for
monitoring the advice provided to participants by GuidedChoice.
These entities are affiliates of each other and are wholly owned
subsidiaries of The Charles Schwab Corporation. *** National
Defined Contribution Council; Defined Contribution Market Insights
2003. DATASOURCE: Charles Schwab CONTACT: Mike Peterson,
+1-330-908-4334, or ; or Lindsay Tiles, +1-415-667-3997, or , both
of Charles Schwab Web site: http://www.schwab.com/
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