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If one of your new year’s resolutions is to manage your retirement investments, you may need some direction about where to start. No matter what your age, you’re not too young to start saving for retirement. The funds you invest for retirement at age 25 can be worth a lot more than the money you save at age 50. Whether looking to save enough to retire from your job or you’re dreaming of retiring to a tropical island, saving for retirement can determine how you spend your golden years.
Jemstep, a company I wrote about a year ago in Jemstep – Helping You Shape Up Your Investments!, has developed a retirement investment tool to help you manage your retirement funds. I recently spoke with Simon Roy, President of Jemstep, about their new Portfolio Manager service that launches today.
Background Study
In December, Jemstep commissioned a Harris poll that surveyed over 2300 US adults aged 18 and over about their retirement investments. 53% of the respondents had retirement savings while 43% did not. Of those 53% who have retirement savings, 50% manage their accounts on their own. The survey also found that 70% of people had little or no idea about how to effectively manage a retirement portfolio.
“Most Americans are very concerned, and appropriately concerned, about whether they will have enough money for retirement,” said Roy. “Many of them find retirement planning intimidating, and complex.”
Roy explained that the Harris study found that most people want to take more control of their retirement investments to improve the outcome, but don’t feel confident in their ability to make those investment decisions. “Jemstep Portfolio Manager helps provide a path for these self-managed investors who want to manage to a better outcome.”
What Jemstep Portfolio Manager Does
Portfolio Manager is designed to help people manage their retirement investments even if they have little to no knowledge of the investment market. “We’ve built Portfolio Manager to be accessible and easy to use with the goal of helping individuals irrespective of their level of wealth or their level of sophistication. We’ve designed the service to provide them with very personal guidance that allows them to actually get on with their lives.” Roy explained that Portfolio Manager can be used for anyone from recent college grads to those who are nearing retirement.
Jemstep takes information provided by the investor, analyzes that information, and develops an action plan showing investments recommended based on risk tolerance, quality of funds and tax consequences. The action plan then shows predictions of how much money the investor would have for retirement following their current plan versus following the Jemstep action plan. “The goal is to guide them to the right portfolio and then tell them exactly what to buy and what to sell in each of their accounts to achieve a better outcome in retirement,” said Roy.
The action plan divides investment accounts into different groups, depending on their tax status:
- tax-deferred – IRA or 401(k)
- taxable – regular brokerage account
- tax-free accounts – Roth IRA
The action plan evaluates the holdings in each account according to its tax status.
Jemstep has worked with an investment team to develop investment strategies that have been back-tested against the S&P 500 for the past 14 years and have outperformed the index each year. Jemstep has developed these strategies based upon Nobel Prize-winning economic research and portfolio modeling strategies, in consultation with veteran institutional money managers and investment experts.
Jemstep uses these strategies to figure out which investments are most likely to give you the best returns based upon your acceptable risk levels, your investment amounts and time until retirement. The program assesses 20,000 mutual funds and exchange-traded funds (ETFs), analyzing 50 or more attributes of each one, including the quality of the funds, the fees charged by the funds and risk level of the funds.
“We’re bringing the very best of personal wealth management and institutional expertise and using technology to make it accessible to the everyday investor.” Roy gave the example of going to an investment counselor and receiving a binder full of investment advice that you take home and put on your bookshelf. “The day it’s printed it’s out of date,” explained Roy. “We believe we provide a superior service using technology and superior investment advice.”
Jemstep offers its services in the US only.
Getting Started with Jemstep Portfolio Manager
If you don’t already have a Jemstep account, you can register for one at the Jemstep website. If you have a Jemstep account already, you can merge it with your Portfolio Manager account. “Anyone who’s currently using Jemstep can seamlessly move over to the Portfolio Manager service and link their retirement accounts,” said Roy.
Jemstep asks a few questions to learn about your situation in life, including age, marital status and age at which you would like to retire. You can enter information about your retirement accounts to link them with your Jemstep account.
Jemstep analyzes your retirement portfolio and shows you the monthly income you can expect to receive upon retirement based upon your current investments. Jemstep also shows you an action plan, predicting how much more you could receive if you followed Jemstep’s guidance. The action plan shows you what to buy, hold and sell in each of your accounts, taking into account risks, tax consequences, fund quality and fees.
“We analyze your current portfolio and we tell you exactly what you’re on track for and what you can expect if you stay on the current path. We then offer a recommended portfolio and asset allocation and try to make it very clear what the financial benefit is to you in dollars and cents each and every year of your retirement if you shift to this portfolio,” said Roy.
Once you have made the trades, Jemstep continues to monitor your portfolio while you get on with your life. Jemstep continues to check the market and the funds and gives you alerts when you should make adjustments to your portfolio.
Cost of Jemstep
This service is free to all users until March 1, 2013. After that date, the pricing is as follows for portfolio values:
|
Up to $25,000 |
$25,001 – $150,000 |
$150,001 – $300,000 |
$300,001 – $600,000 |
$600,001 and above
|
|
Free |
$17.99 per month
|
$29.99 per month
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$49.99 per month
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$69.99 per month
|
|
|
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Jemstep gives a discount if you pay annually. Roy compared the monthly fees to the price of a pizza per month up to a dinner for two at a restaurant. “At those levels we are way below the fees of an investment advisor.”
Jemstep does not receive any payment from funds or brokers.
Original Jemstep vs. Jemstep Portfolio Manager
The original Jemstep is free of charge. When asked about the difference between the two programs, Roy said, “The original Jemstep was focused on investors looking to manage specific investments and asset classes and see all of their accounts in one place.” The Portfolio Manager builds on that and helps people specifically manage their retirement portfolio.
The original Jemstep fulfills a more narrow need, according to Roy. The original Jemstep can show you the best large cap fund to invest in, but won’t give you the overall best plan for retirement and shift between asset classes. The Portfolio Manager also gives you alerts when it’s time to adjust your investments.
Bottom Line
If you’re looking for ways to plan for retirement, check out Jemstep Portfolio Manager. The service is free until March 1, so you can try it to see what suggestions Jemstep has for your retirement investments. While risk is involved in any investment, Portfolio Manager may be able to help you manage your risks. Portfolio Manager may give you some valuable guidance on how to plan for your retirement, making that tropical island seem closer than you thought.
Is one of your new year’s resolutions to manage your retirement savings? Do you find managing your retirement investments challenging? Do you dream of retiring to a tropical island ? Let us know in the Comments section below!
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Wonder of Tech Interview
For more Wonder of Tech, check out my interview in Techwork DK by Thomas Nielsen: Interview with Carolyn Mohr from WonderOfTech.
* Tropical Beach image by Ed Yourdon
HI Carolyn
Great Post!
After reading the post I feel jempost portfolio manager is brilliant, and earlier one subscribed to this, better it will be.
Thanks for sharing this.
Sapna
Hi Sapna, Yes, I was very impressed when I tested out Portfolio Manager. This could make a big difference in people’s lives. Of course nothing can guarantee investment returns, but this program looks easy to use and may help guide people to a more comfortable retirement.
Sounds interesting Carolyn!
People in the U.S. are indeed lucky to have such a wonderful retirement plan that literally guides them through with their action plan. In our country too we have such retirement plans, but I wonder if they go this much into detail. I guess one’s never really thought about retirement, though we should!
With age catching up fast and never knowing what life has in store for us, it’s best to have your retirement plans in place, as well as your insurance, something that most of us tend to neglect. I guess we need to think about such things before we grow old – isn’t it? 🙂
Thanks for sharing this with us, and reminding us about it too. 🙂
Hi Harleena, Yes, Jemstep is quite innovative in the way that they approach investments. They try to make it easy for everyone to use their services to try to find the investments best suited for their risk tolerance, time until retirement, etc.
Yes, we never know what life will bring to us, so having a retirement plan in place can help reduce the stress in life.
I wish Jemstep were available for you, Harleena, but I hope you find a retirement plan that works well for you.
Hi Carolyn,
This sounded like a good idea, until I read the details. I don’t like funds. The fund managers here take 20% commission if they make money and lose nothing if they lose money. The funds in the UK don’t do very well. I’m not having a good week, but even if I count losses from the early days when I was learning to invest, I still do better than the funds. One company lost 50% of it’s share price this week and another 25% and I’m still doing better! Fund managers panic too. I lost moeny this week just because fund managers panicked when the CEO of one company resigned. He will be around for months as the new CEO takes over, who is also very experienced. The problems is this fund managers, think short term, they speculate rather than invest. I do benefit sometimes from their little panics though!
I’ve been in Moorcroft Wood this afternoon, the snow melted and put a lot of water in the ‘Sanna’. It looks quite good now. The whole nature reserve will be worth visiting in Spring, lots of bluebells will be in the woods this year.
I went shopping too, still haven’t got a new coat! I had a free voucher towards it too and couldn’t find one suitable.
I’m having 2 days with no writing, so I can think of some ideas for my nostalgia blog on Friday. It’s my birthday. What else would I write about! 🙂
Hi Mike, Wow, fund managers in the UK take a much bigger commission than they do in the US. Jemstep Portfolio Manager is designed to look for quality funds with low fees to maximize returns. Any portfolio manager who took 20% would have to generate significant returns to make the investment worthwhile.
Happy birthday, Mike! I hope it’s a wonderful day for you. I look forward to your bluebell pictures in the spring. I miss seeing those in England!
Hi, Nice post. This sounds really great that jempost portfolio manager makes things quite better. That will be nice.
Hi Prakash, Yes, I was very impressed with this new investment tool that Jemstep launched today. Thanks for sharing your thoughts with us, Prakash!
Hello Carolyn,
A good and effective blog is share by you again.
I am very far from retirement but saving is good.
Really you share a good content with this blog which is helpful most of the people thanks!
Hi Sanchit, Yes, I started saving for retirement with my first job out of school. I was single and didn’t have many expenses so I invested a small amount then that has grown throughout the years.
Every little bit you save now can make your life easier in later years! :-bd
Great share Carolyn and I agree… If you’re young you need to start early planning for retirement because you don’t want to get to that time and realize you have nothing saved.
I wish I had known about these types of things when I was younger. No one shared this type of information with me so I got started a little late. That’s okay, better late then never but you’ll be much better off starting as early as you can.
~Adrienne
Hi Adrienne, I wish that Jemstep was around when I was younger, it would have made retirement planning easier when I was just starting out.
You’re right, the earlier we start saving for retirement, the easier it will be to save. You’re right, though, better late than never!
Carolyn,
Preparing for retirement is a must! I know of many parents that only plan for college for their children or a vacation fund but the singular most IMPORTANT thing anyone can do is plan for their own future. I understand the importance of college, vacation etc… but if we aren’t planning for ourselves we will have major issues in the future. We might not be able to continue the lifestyle we have become accustomed too.
Aaron Brinker aka DadBlunders
P.S. I have a question for you Carolyn – I don’t know if you will know the answer or not but it is something that others “might” be having problems with – I have checked the prompt NUMEROUS times on commentluv “Check here to Subscribe to notifications of new posts” I have yet to receive anything from your site (including anything to confirm that I wanted updates). Luckily, I am a loyal fan and continue to check to see if you have new posts 🙂
Hi Aaron, First, thank you kindly for subscribing!
Second, I have you listed as an email subscriber as of January 25, which means that you should have received email notifications of posts on Monday and yesterday.
Please check your spam folder to see if the notifications are going there. Unfortunately, Gmail sometimes sends Wonder of Tech emails there even though I never, ever send out spam emails!
If you still don’t see it, let me know.
Third, you are so right about retirement. People too often live for the here and now instead of planning for the future. Having insufficient retirement savings can be very stressful before and during retirement.
Thanks for being a loyal fan, Aaron! 🙂
Hey Carolyn
I have a background in the pensions industry in the UK. There are so many different types of pension over here and an app of this kind may not be suitable for many of them unfortunately; probably only for self-invested plans.
I wish things were simpler!
Hi Tim, Yes, in the US, many people do not have pensions. Those who do may want to supplement their pensions with their own retirement savings. We have social security here but social security funds are limited and need to be supplemented for many people.
You’re right, self-invested retirement plans are the ones that would benefit from Jemstep.
Hi Carolyn,
Very nice one on planning retirement 🙂
Hmmm… It makes me think 🙂 I’ve been saving the money I’ve got from clients and I feel how much careful I am when I start with no money in my hand. It teaches me how to cut costs and I haven’t thought that far about the retirement though.
I feel it’s very true that it doesn’t bother us if we think about it in 25 which is my age right now 😉 I can see how my father struggles with it. No it doesn’t mean he doesn’t have money but I feel he could have save more if he thought about it more. It’ not only him but I can see more people who have gone through retirement worry about their savings and still trying to make money though they are not ready for it. A good lesson for me 🙂
Well, now I wanna ask that how it could worth for me Carolyn. You know I’m out US and here we don’t really go with much taxes as some of our resources are natural ones, such as we don’t pay for Water. If I hear about US, it’s all about taxing and keeping accounts 😉
I think it’s better to wait for your reply 🙂
Cheers…
Hi Mayura, You are very wise to think of retirement even at a young age. The sooner you start saving the easier it will be for you to achieve your goals.
Yes, life is quite different here in the US. We don’t pay for water at our home because we have a well. But people who have public water have to pay for it.
Unfortunately people outside the US can’t use Jemstep. They are US only and have no plans to expand outside the US. I can understand with investment regulations how challenging it would be for them to expand outside the US.
I hope you find a good place to invest your retirement funds in your country, Mayura!
This year I’m gonna be 25 years old. Not really thinking about my retirement but yeah, I should.
I’m planning a pension plan with my personal back as well as paying a fixed sum to my government, hope I will get money from both sides ones I’m ready to retire, even though that’s like 40 years into the future and who know what happens until then. Maybe I’ll have enough success over the years to make retirement funds not a problem.
Hi Christian, I certainly hope that you are so incredibly successful that you never have to worry about funding your retirement! 🙂
Jemstep looks like an awesome way to plan the retirement. So far, I haven’t planned anything other than that I hope that starting my business will help me to get a safe and fun retirement. But, I am still just in the planning phase of my business and it will take some time before I can do anything to plan my retirement when it comes to money and investments 🙂
Hi Jens, Yes, getting ready for retirement may seem like a distant goal. You certainly are focused on one thing now, getting your business up and running. I hope your business is so wonderfully successful that you don’t need retirement savings. After all, Bill Gates didn’t have to worry about retirement savings too much!
Hi Carolyn,
Many thanks for the great review of Jemstep Portfolio Manager. I hope your readers find it to be of real value and I am happy to respond to any questions they may have. Much appreciated.
Regards,
Kevin (Joint CEO)
Hi Kevin, Welcome back to The Wonder of Tech! Congratulations on the launch of Jemstep Portfolio Manager. Thanks for stopping by and offering to respond to readers’ questions. Best wishes for much continued success with Jemstep.