July 7, 2016
WealthBar pioneers online full-service, low-cost group RRSP
VANCOUVER, BC -- Companies that want to support their employees in saving for retirement can now purchase group registered retirement savings plans (RRSPs) for a fraction of the cost of traditional plans.
The plans offered by Wealthbar.com, Canada's leading full-service online wealth manager, also provide group members with a dedicated advisor, an individual financial plan and investment advice tailored to each member's individual circumstances. It's the first time that a financial technology provider in Canada has offered a full-service, low-cost group plan.
Plans will cost less than 1% in fees, compared to the industry norm of 2-3%. This means employees can save thousands of dollars annually, while employers can set up and maintain the plans at a fraction of the cost of the alternatives.
In addition, these plans bring more transparency, automatic rebalancing and better investments to group members.
"At WealthBar, we often find ourselves advising people who come to us with traditional group RRSP plans," said Tea Nicola, CEO and co-founder of WealthBar. "This has given us a lot of insight. Unfortunately, it's a familiar story: offerings are limited, while fees are high. It's just not necessary."
Most group RRSPs are offered by large insurance companies and have limited product choice, often with little to no individual advice.
"HR professionals get a lot of financial questions from their employees that they cannot answer," said Nicola. "Employees often select the wrong portfolio for their circumstances, or just don't participate at all. By having a direct line to a dedicated advisor, HR professionals can confidently send their employees to WealthBar for that advice. This increases participation and ensures they're invested in a plan that's tailored for them."
Unlike other group RRSPs, the WealthBar RRSP will automatically become a low-fee personal plan when an employee leaves or retires from a company, making it significantly more convenient to continue investing or transfer to an institution without interruptions. The client will also have access to free retirement income planning to make a seamless transition into post-work life.
If they choose, employees can have all of their household investments managed with their own WealthBar advisor and dashboards, all in one place.
"We're looking to truly transform the group benefits industry," said Nicola. "If employers can have a group RRSP at a fraction of the traditional cost, with a higher level of service, transparency and better convenience, it should be a no-brainer to switch."
The plans can be used for small and medium-sized businesses, too. Any organization with 10 or more employees can set up a WealthBar group RRSP at no cost, and can set the amount it would like to contribute. Characteristically, group RRSPs can help employees save 10% of their annual salary, 5% coming from their contribution and 5% matched by their employers.
Research shows that a group RRSP can help lead to happier and more productive employees, as it helps investors build positive financial habits and achieve financial stability.
Employers can visit wealthbar.com/group to learn more about the plans and get started. Employees can champion the switch to better investments by visiting wealthbar.com and requesting a toolkit for their HR department.