Boston - Financial institutions that make online retirement tools readily available can increase consumer retirement account participation and action. That's the conclusion of a study conducted by Compete, Inc., a market research firm, with MSN and Media Contacts.The study, titled " Consumer Adoption of Online Retirement Planning Tools," was initiated to understand how consumers use online retirement tools at leading financial sites to develop and execute their wealth accumulation strategy. It revealed that every month an average of 180,000 consumers use online retirement tools, and consumers who are aware of the availability of online retirement tools and use them, are more likely to take action, according to Mike Bailey, managing director, financial services practice, Compete Inc. "Retirement sites need to seize this opportunity to leverage tools that develop relationships with consumers who will evolve into active customers with higher value accounts."
Compete's research sought to answer critical questions pertaining to the use of online retirement tools, by generational segment (Gen Y, Gen X, Baby Boomers and Seniors). The study evaluated online activity across key financial advisor, direct broker, retirement plan provider, financial media and financial portal sites. It examined search and navigation behaviors of online consumers and gathered attitudinal feedback using a targeted online survey.
"This study shows that financial sites should make online retirement tools more visible and use the availability of tools to draw consumers deeper into retirement-related content," says Ed Montes, senior vice president and group account director for Media Contacts, the interactive buying and planning unit of Boston MPG.
Key findings from the study include:
- Nearly three out of four users indicate that use of an online retirement tool impacted their strategy; 64% changed allocations among investments, and generations "X" and "Y" were more likely to increase the amount contributed to their 401K.
- Tools users engage with retirement sites at a much greater rate than do those who are not actively planning their wealth accumulation strategies. Consumers who use retirement tools are twice as likely to interact with online lead forms and five times as likely to initiate a new account opening online.
- Baby Boomers comprise the largest segment of online tool users in total volume, while seniors represent the generation most likely to be tool users. Retirement planning for generations "X" and "Y" isn't a "top-of-mind issue".
- Younger consumers are starting to save at an earlier age. Each generation has started to save for retirement five years earlier than the previous generation.
Source: Compete Inc.
