Plan sponsor update with Chris McIsaac
Chris McIsaac: Hello, and welcome to Vanguard’s plan sponsor update. I’m Chris McIsaac.
But in the next few minutes, I’ll touch on some of the major changes in store for 2014. Let
me start by taking you on a quick tour of our two new buildings that will help us serve you
even better in the years ahead.
Why did we move into this new space? A couple of reasons. First, it will allow for better
collaboration among the client teams that serve you. Second, we’re building a Client Center.
This will be an interactive space where you and your Vanguard team can meet to discuss
strategies to strengthen your plan. We hope you come visit us soon and see it for yourself.
And throughout 2014 our significant investment to the Plan Sponsor Bridge will empower
you with the data, insight, and tools you need to manage your plans. The new Bridge will
put essential resources at your fingertips.
Your participants also have a lot to look forward to in the coming year. For one, we’ve
entered into a new partnership with HelloWallet. For adopting sponsors, this web and
mobile application gives your participants personalized guidance on spending, saving,
debt, and benefit decisions. For you, HelloWallet can enable you to measure and improve
compensation and benefit-program outcomes.
For the growing number of employees approaching and in retirement, two new services can
help them translate their balance into a retirement income stream. Vanguard’s retirement
income modeler helps participants analyze their finances from a variety of perspectives so
that they can determine a prudent withdrawal strategy. Later this year we’ll enhance this
capability into a free, ongoing installment service for retirees so they can set up systematic
withdrawals from the plan.
The second service is called Income+. It can help retired participants with their investment
and withdrawal strategies so that they can enjoy a steady stream of income in their
retirement.
You’ll also continue to see upgrades in our web and mobile capabilities. Vanguard offered
mobile app transactions before any other retirement provider. And now, according to our
research, monthly app visits are tripling each year—and they increased by nearly 150%
over the past six months.
Amid all the innovations for you and your participants, our funds continued to serve you well.
In 2013, you helped make us the number-one provider of target-date funds.
(continued on next page)
Meet the contributor
Chris McIsaac
Managing Director
Vanguard Institutional
Investor Group
Vanguard Target Retirement Funds continue to grow at a rate that outpaces the industry.
More than 40% of last year’s target-date industry cash flow went into our Target Retirement
Funds. (Sources: 2013 Morningstar, Pension & Investments, Cerulli, T.Rowe Price, and
JP Morgan SEC filings; Vanguard analysis.)
Now, how did these funds benefit your plan and your participants? Our research shows that
participants using Vanguard’s low-cost Target Retirement Funds have more balanced portfolios,
more age-appropriate allocations, and less investing at the extremes than do-it-yourself
investors. (Source: Vanguard, How America Saves 2013.)
And as valued partners, you also play a lead role in some major milestones and client
recognition we’ve received: 2013 saw $138 billion in net cash flow ....our second-best year
ever. Our defined contribution business alone took in a record $22 billion last year, helped
by the 1,200 new plan-sponsor clients who came on board.
Together we’ll find some terrific opportunities in the year ahead to make your retirement
plan even stronger. On behalf of everyone here at Vanguard, we appreciate your ongoing
commitment and partnership. And we thank you very much for watching this update.
Important information
For more information about Vanguard funds, visit institutional.vanguard.com or call 800-523-1036
to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important
information about a fund are contained in the prospectus; read and consider it carefully before
investing.
Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the
fund name refers to the approximate year (the target date) when an investor in the fund would retire and
leave the workforce. The fund will gradually shift its emphasis from more aggressive investments to more
conservative ones based on its target date. An investment in a Target Retirement Fund is not guaranteed
at any time, including on or after the target date.
Institutional Investor Group
P.O. Box 2900
Valley Forge, PA 19482-2900
All investing is subject to risk, including the possible loss of the money you invest.
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