Bank of America Corp (NYSE:BAC) Merrill Lynch has been rated the nation’s most successful 401(k) plan provider, according to a study by the National Association of Retirement Plan Participants (NARPP), a nonprofit organization and advocate for individual savers in these plans. Findings from NARPP’s second annual Participant FELT Study™ are based on interviews with more than 4,300 active retirement plan participants.
FELT – which stands for Financial Empowerment, Literacy and Trust – is a pioneering study that identifies key drivers of savings rates and other behaviors of 401(k) plan participants, and explores how and where service providers have been successful in helping employees engage with their plans and improve financial literacy and outcomes.
“Our latest research shows that Bank of America Merrill Lynch is one of the most trusted brands in the industry, and receives among the highest marks for education programs offered to plan participants,” said Laurie Rowley, NARPP co-founder and president. “Without question, employees’ trust in a 401(k) service provider has a tremendous impact on the degree to which they engage with their plan. When combined with education, this can lead to higher levels of confidence among employees and improved outcomes when preparing for their financial future.”
The Participant FELT Study was designed by NARPP with Boston Research Technologies and professors from Stanford University. The study includes a FELT Score, the first standardized metric to evaluate how well record-keepers are engaging and educating their plan participants, the level of trust that participants have in their record-keeper, and the corresponding participants’ financial literacy and rates of deferral. Among 18 of the nation’s leading 401(k) plan providers evaluated through this study, Bank of America Merrill Lynch received the highest overall score based on insights gathered from plan participants.
“Though there’s work to be done across the industry to further improve participant programs and confidence, we are proud to have earned the top spot in this study. The achievement reflects our commitment to helping make people’s lives better, in part through the work we do every day with plan sponsors to tailor financial education and communication programs to align with needs of their employees,” said David Tyrie, head of Retirement and Personal Wealth Solutions for Bank of America Merrill Lynch. “We offer a range of financial education resources across several channels, including in-person, phone, online and via mobile devices, so employees can choose the avenues that fit their needs and preferences. This is one of several areas that demonstrate our company’s focus on helping people make more informed decisions, achieve better outcomes and improve their overall financial wellness.”
A recent Bank of America Merrill Lynch report showed that last year, nearly four out of five active 401(k) participants in its plans who made a change to their plan made a positive one, by either starting or increasing their contributions.1 The report found that among the 2.5 million employees in these plans, more are taking greater advantage of the financial education resources offered to them by their employers. For instance, meetings with Merrill Lynch educational specialists increased 14 percent last year, calls to the company’s Retirement Education Services center increased 18 percent and visits to its online Education Center increased 15 percent. The company also saw a 46 percent increase in the number of unique visits to its Benefits OnLine® mobile/smartphone-optimized site, as employees increasingly seek self-service information about preparing for retirement when it’s most convenient for them.
1 401(k) Wellness Scorecard is based on the Bank of America Merrill Lynch proprietary 401(k) business, which comprises $128.9 billion in total client plan assets and 2.5 million total plan participants as of December 31, 2014. (Original Source)