Data Analytics can help deliver competitive plans, work out retirement incomeBy: Pradeep C - Dec 17, 2018
The retirement industry is inherently data-driven. Analyzing this data can give us trends and predictive models that can help us take smart and considered decisions.
Data analytics is the process of examining data sets to draw conclusions about the information they contain. This information can then be used to optimize processes in order to enhance productivity or to improve the efficiency of a business.
The use of data analytics in the retirement industry covers varied areas like investments, retirement planning, medical plans and so on. With the advent of powerful data processing and advanced analytics tools, all the data preparation and data analysis processes have become relatively easy now.
Predictive retirement analytics helps the various stakeholders in the industry in different ways. It assists plan providers to redesign plans, optimize plan management, and thereby deliver competitive retirement plans. It also enables the Plan Sponsor to optimize plans, and take informed decisions that will ultimately benefit the plan participants. A plan participant benefits from data analytics through predictive trend analysis of investment options, so as to maximize ROI.
Predictive analytics also plays a major role in the retirement industry to tackle any adverse condition that may have been caused by a country’s economy. For instance, when there is economic instability, the retirement income of the workforce may reduce significantly. However, this situation can be mitigated by data mining of various data points such as income, marital status, number of dependents and variable economic factors, to predict the best Income Replacement Ratio (The amount of income needed by the plan participant, post-retirement, to maintain the same standard of living).
Current data analytics tools can be effortlessly integrated into enterprise-class solutions, giving the end user seamless transition between record keeping and data analytics. This makes the final product a one-stop solution for all.
Data analytics is here to stay. People who make effective use of this predictive science can reap rich rewards, at minimal cost.
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