3 best practices for 401(k) plan participant dashboards

July 1, 2021
closeup of man looking at his laptop (Photo: Shutterstock)

Retirement plan participants are looking to digital tools to keep informed and manage their accounts. The quality of the homepages and dashboards they are provided can have a significant impact on their overall satisfaction with the digital experience associated with their retirement plan, according to a new report from financial services research firm Corporate Insight.

The report recommends best practices for recordkeepers for developing participant homepages and dashboards based on findings from its 2019 DC Plan Participant Survey.

That study found that participants typically access a digital plan dashboard for two reasons: to check on their account or to perform a specific task. When checking on their account, participants often do not have to navigate beyond the homepage or plan dashboard, the report said.

When developing participant-facing tools, recordkeepers should keep the following best practices in mind.

1. Focus on the data that’s most important to participants. According to the firm’s research, the eight most important metrics participants want to see on their dashboard are their account balance, contribution rate, vested balance, rate of return, recent transactions, investment balances, employer match and historical balances. 

However, recordkeepers are missing the mark on providing the data participants want on their dashboards. While 100 percent of the recordkeepers surveyed by Corporate Insight provided participants’ current account balances on their dashboards, only one-third provided historical balances and less than half provided information on the employer match. Recordkeepers were most focused on providing rate of return, contribution rates and investment balances.

“Firms lacking top-rated metrics should consider integrating them to improve their plan summary experience,” said the report.

2. Provide modeling and transactional capabilities in retirement readiness sections. More than half of survey respondents said income projections are very or extremely important to them, and a similar percentage wanted retirement readiness scores.

Most recordkeepers list monthly income projections, while fewer offer a retirement readiness score on their website or dashboard, the report said. About three-quarters of recordkeepers provide retirement income goals and gap analysis within their digital tools.

Participants are interested in the ability to adjust inputs including their contribution rate and retirement age to view how certain decisions could impact their retirement readiness, said Corporate Insight.

About half of participants surveyed rated this feature as important, while about 56 percent of firms provide adjustable inputs and 39 percent dynamically update retirement readiness data as participants model alternative scenarios, said the report.

Only 22 percent of firms offer actionable advice, and only 39 percent allow participants to enact modeled changes from homepages or dashboards, which Corporate Insight said are key best practices to encourage positive retirement planning behaviors.

3. Keep it simple. Some of the best homepages and dashboards use organizational tools that allow them to house a wide selection of data without increasing screen length or cluttering the display, said the report.

About 60 percent of participants indicated a concise page that does not require excessive scrolling is important. Organizational devices that can help keep a page clean and concise include intrapage tabs or section view filters, expandable sections and carousel sections.

“The benefits of providing a robust selection of homepage data decreases if the site does not communicate the data in an intuitive, digestible manner,” said Corporate Insight. “Providing effective visuals … can help participants absorb information and make more informed judgements.”

Kristen Beckman is a freelance writer based in Colorado. She previously was a writer and editor for ALM’s Retirement Advisor magazine and LifeHealthPro online channel. She also was a reporter for Business Insurance magazine covering workers compensation topics. Kristen graduated from the University of Missouri with a degree in journalism