Private sector companies tend to offer retirement and financial advice to their employees well beyond what federal employees and retirees get through the TSP, a recent survey by the Aon Hewitt consulting firm showed.
Companies are expanding their focus “on the overall financial well-being of their workers” and they are broadening the types of financial and planning tools and resources they provide to their workers. For example, 69 percent offer online investment guidance, up from 54 percent last year, and 18 percent of the remainder say they are very likely to add that feature within the next year; 53 percent offer phone access to financial advisors, up from 35 percent; 49 percent offer third-party investment advice, up from 44 percent; 47 percent offer managed accounts, up from 39 percent; and 46 percent are very likely and another 47 percent are somewhat likely to “add new plan features, mobile apps or online tools to assist individuals with understanding financial concepts and financial planning. “
“Depending on the individual needs of their employee populations, companies are offering features like basic budgeting help, while others are providing assistance on how to save for life events like a home purchase or college,” the firm said.
The TSP always has taken the position that it can offer only information and not advice, but recently members of its governing board expressed interest in providing more, in the context of considering whether to also add ability to invest in funds outside those offered by the TSP itself. In both cases, one justification being offered is that the TSP needs to take such steps to remain competitive with outside investment options, in particular the flexibility to transfer money to an IRA on retiring or separating from federal employment.