Young retirement robo ForUsAll scoring high employee participation rates

ForUsAll, a budding retirement robo-adviser launched by three former Financial Engines employees, is having more success convincing plan participants to save for their futures than the industry as a whole.

Companies using the automated advice platform for its retirement plans are seeing nearly 90% of eligible employees contributing to their 401(k) account, according to ForUsAll. That compares to about 84% of eligible participants with balances in 401(k) plans nationwide, the 2016 Plan Council of America retirement report issued earlier this month found.

The firm’s founders credit their success with employee engagement to Dave, ForUsAll’s tech-enabled virtual adviser. By regularly staying in front of employees through emails and texts, Dave keeps employees engaged, answers their questions, and gets people to stay in the plans, said Shin Inoue, chief executive and founder of ForUsAll.

“Our goal has always been to make it as seamless as possible for plan sponsors to offer good retirement savings plans,” said Mr. Inoue, formerly director of new business at Financial Engines.

Sunnyvale, Calif.-based Financial Engines is the nation’s largest independent investment adviser, with total assets of $134 billion.

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While at Financial Engines, which focuses on serving Fortune 500 companies, Mr. Inoue and his two co-founders found that small- and medium-sized companies were underserved and overcharged for retirement plans. They started ForUsAll to provide cheaper, technology-based services for companies of this size, he said.

ForUsAll costs about half of a typical traditional 401(k) plan available to small- and mid-sized businesses, Mr. Inoue said. The firm’s technology simplifies the onboarding process and automatically enrolls investors into target date funds.

“You shouldn’t have to work for a Fortune 500 company to have a good retirement,” Mr. Inoue said.

He started the firm in 2015 with David Ramirez, who was a portfolio manager at Financial Engines and is ForUsAll’s chief investment officer, and Dave Boudreau, who was a customer service principal at Financial Engines and is heading up customer service, including “Dave,” at ForUsAll.

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In addition to convincing participants to save for their own retirements, the San Francisco-based firm appears to be presenting an effective argument to attract clients, as it grew assets on its platform to $100 million from $5 million at the start of 2016.

The ideal retirement clients of ForUsAll are businesses with $1 million to $10 million in assets and 50 to 2,000 employees, Mr. Inoue said. It’s attracted many professional services companies, such as real estate management businesses and hotels.

CMC Properties, a firm using the robo platform for its 401(k), said cost and its employees were top of mind when selecting ForUsAll.

“We chose ForUsAll because we were looking for a plan that helps encourage higher participation and savings rates, lowers our costs, and helps our employees save for retirement,” said Chasta Postler, a CMC Properties regional director.

ForUsAll reports average savings rates in its plans of 6.5% to 7.4%, compared to an average of about 7% for all plans, the Plan Council of America report said.