Would it be beneficial for a retirement plan provider to offer apps for plan participants, and if so, what functions would be most appreciated by plan participants?
The usage of smartphones and tablet devices continues its rapid growth. Nearly two-thirds (65 percent) of households with a net worth (excluding primary residence) of $100,000 or more, own one, while 40 percent own a tablet. One of the factors that has helped drive this growth is the profusion of “apps” which provide a wide variety of specific functions and which are usually offered for free or a very low cost.
Financial institutions are increasingly getting into the act. For example, several banks now allow check deposits into an account using an app which uses a smartphone to photograph the check. Given the popularity of these devices, it would seem that the time is right for retirement plan providers to develop apps.
Some already do. ING’s Retirement Plan account app lets participants check current balances and balance history as well as fund performance on their mobile device. They can also change their contribution rate, transfer money among funds and reallocate their current balance.
The purpose of an app is to extend website access to locations or situations where the usual laptop or desktop computer is not available. The tablet screen is sufficiently large that accessing a full functionality plan website would not especially require the need for a special app. Smartphones, however, have much smaller screens, ranging from about two by four inches to about three by five inches. A screen this small is not optimal for using the plan website. In would seem then that retirement plan appsif there are apps that would be worth developing, they should be aimed at smartphone users.
Recent Spectrem Group research shows that just 8 percent of plan participants have tried to access their plan websites using a smartphone or tablet. Another 31 percent, however, say they are likely to do so in the future. When asked what actions they want to accomplish using their smartphones or tablets, 42 percent say they need only to view specific items (e.g., account balance). The larger proportion (58 percent), however, say they would like to be able to conduct transactions (e.g., change allocation or payroll contribution). The chart below shows the specific activities plan participants say they would be most interested in doing with their smartphones and tablets.
It appears that there is sufficient interest among participants to make the development of apps, specifically those designed with smartphone screen sizes in mind that would be useful to plan participants.