Press Release
American Express Unveils Comprehensive Advice and Guidance Platform
Selects Mornighstar Clearfuture Online and Phone Center Applications
MINNEAPOLIS, January 30, 2003 -- American Express Retirement Services announced today that it has selected Morningstar Associates, LLC, to provide the independent investment advice component of its retirement plan advice and guidance platform. The new offering, scheduled to be introduced this summer, combines the power of Morningstar® ClearFuture®, a leading investment advice and guidance service, with the most dynamic platform of personal, face-to-face delivery in the industry—American Express financial advisors and telephone-based American Express Retirement Services Series 7 licensed financial consultants.
American Express Retirement Services has selected the online and phone center applications of Morningstar ClearFuture, marking the first time retirement plan participants will have access to ClearFuture via three different channels: the web, in person and over the telephone. Within the new platform, American Express Retirement Services will make Morningstar ClearFuture guidance available to all of its 330 client plans and their more than 1 million participants. In addition, plan sponsors also will have the option to upgrade their plan to full service advice capabilities.
According to Ward Armstrong, president of American Express Retirement Services, "Our research* shows that more than half of the people working for companies with 401k retirement plans would like assistance in deciding where to put money in the plan. Not surprisingly, more than one third said their need for advice has increased with the recent market volatility. By offering an accessible and affordable platform and including Morningstar ClearFuture as an independent advice and guidance component, we are breaking down the barriers that have kept participants from taking action. We are giving them the tools to gain greater confidence in how they are preparing for their retirement future. The new platform is a natural progression for American Express Financial Advisors, a leading financial planning company for more than 100 years, in helping people address their complete financial needs."
John Rekenthaler, president of Morningstar Associates, said, "American Express Retirement Services recognizes the importance of choice in retirement planning. Some people are comfortable making their own investment decisions or just using our web-based service, but many want to talk to an expert—either face-to-face or over the phone—to get guidance or specific investment advice. American Express Retirement Services' new multi-access platform harnesses the independent, investment research and technology of Morningstar ClearFuture and delivers it to participants when, where and how they need it. It also gives greater flexibility to plan sponsors because they can choose among a variety of delivery channels or service levels. We are delighted that American Express Retirement Services is the first company to integrate the use of personal support through a phone center with ClearFuture."
"We're also breaking down the barriers to offering advice and guidance for plan sponsors," said Armstrong. "Our platform solution and selection of Morningstar, known for their rigorous approach and accountability, should help put plan sponsors more at ease knowing they will be kept well informed each step of the way."
American Express Retirement Services' recent national survey* revealed that a majority (61 percent) of consumers were experiencing moderate to high levels of financial stress, and that one quarter felt that their financial stress had gotten worse in the last 18 to 24 months. The survey confirmed the need for a multiple access point approach to advice and guidance, finding that workers have varied preferences about where and how they prefer to receive investment recommendations. More than half indicated they preferred some type of in person consultation, while only 14 percent preferred the web.
"With more volatile markets and financial stress at such high levels, asset allocation and diversification have become more essential than ever for people to achieve their savings goals," said Rusty Field, vice president of American Express Financial Education and Planning Services. "As the market has negatively impacted retirement plan balances, people have quickly recognized they need more help in this area. Yet, the current web-only advice capability in the marketplace falls far short of being effective. Participants need to access investment help by whatever method is conducive to their preferred way of taking action—the phone, the web, personalized report or in person. Whether someone prefers to do it on their own, needs validation for his or her decisions, or would rather delegate the task to an expert, we want to make guidance or advice readily accessible to them," said Field.
Morningstar ClearFuture gathers detailed financial information from participants to provide them with investment recommendations for their retirement plans. Basing its analysis on both retirement and nonretirement assets, ClearFuture offers participants such tools as personalized goal planning, retirement income analysis based on enhanced simulations, and an innovative "bear market simulator" that tests risk tolerance.
Morningstar ClearFuture is currently available to more than 5 million participants through more than 37,000 corporate and public sector retirement plans throughout the United States.
About Morningstar, Inc.
Morningstar, Inc. is a leading global investment research firm that provides an extensive line of print, software, and web-based products and services for individuals, financial advisors, institutions, and the media. Morningstar is a valued source of investment information and analysis for stocks, mutual funds, exchange-traded funds, closed-end funds, and variable annuities. Morningstar tracks nearly 100,000 securities worldwide.
Morningstar® ClearFuture® is provided by Morningstar Associates, LLC, a registered investment adviser and a wholly owned subsidiary of Morningstar, Inc. The financial data and methodology used in ClearFuture are proprietary to Morningstar, Inc., and/or Morningstar Associates, LLC.
About American Express Retirement Services
American Express Retirement Services, a service group of American Express Financial Advisors, is a provider of services for defined contribution and 401k plans with total combined assets of more than $26 billion and a participant base of more than 1 million as of December 31, 2002. Based in Minneapolis, it provides corporations, unions and municipalities nationwide with a complete package of financial education, recordkeeping and trustee services for qualified retirement plans. For more information on American Express Retirement Services, visit www.americanexpress.com/sponsors.
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