Factors Considered in PRO Portfolio Construction
Our PRO Managed Account ® solution considers a wider array of personal factors to help determine a participant’s asset allocation compared to a target date fund. The PRO service coordinates with the plan’s recordkeeper (or other service providers), to obtain the PRO Personalized Default data with no participant involvement required.
The online PRO Retirement Tool portal allows participants to personalize their retirement goals. The PRO Retirement tool also gives feedback on participants’ progress. Most importantly, the tool provides advice on how to accomplish their retirement goals
Comparing PRO QDIA® Solution Consideration Factors vs Target Date Funds
Consideration Factors |
Target Date Funds |
PRO Retirement Tool* |
|---|---|---|
| Age | ||
| Salary | ||
| Savings Rate | ||
| Account Balance | ||
| State Income Tax Rate | ||
| Gender | ||
| Pension Income | ||
| Spouse Age, Income & Savings | Optional | |
| Outside Investments | Optional | |
| Other Income Sources | Optional | |
| Customized Income Goals | Optional |
Here’s what each of these factors allow us to do:
- Age – Gauge participant’s investment time horizon
- Salary – Estimate participant’s retirement income goal and projected Social Security benefits
- Savings rate – Calculate the impact of contributions on the growth of participant’s account
- Account balance – Gauge how close a participant is to their goal
- State income taxes – Estimate how a participant’s state of residence will impact their after-tax retirement income
- Gender – Estimate a more accurate life expectancy
- Pension income – Understand income sources and potential cost-of-living adjustments
- Spouse age, income & savings – Understand the household financial picture for a more complete analysis of the participant’s needs
- Outside investments – Calculate any balances outside of the participant’s workplace retirement plan
- Other income sources – Estimate the potential impact of a second job or rental income on the participant’s target retirement income
- Other pertinent plan information (as applicable) – Incorporate other plan-specific features that could impact a participant’s retirement goals (i.e., profit sharing, employee stock ownership plans, company matching provisions, vesting and tenure-related provisions, etc.)
* Some factors may not be available in all situations
