Financial benefits in the workplace have become a hot topic with leading professionals in human resources, and for good reason. Increasingly, companies that focus on attracting and retaining top talent have spent significant time and resources to deeply understand all aspects of their employees’ workplace experience. Simply put, financially healthy employees are more productive, engaged employees.
Today, we’re pleased to announce the launch of Wealthfront for the Workplace, which we’re piloting with several of the fastest growing companies that are focused on attracting and retaining millennial talent. Wealthfront for the Workplace offers employees of participating companies the benefit of a Wealthfront account with up to $100,000 managed for free to encourage saving and investing.
As part of the pilot, Wealthfront is now offered as an employee benefit at Google, Palantir and the San Francisco 49ers.
The Importance of Non-Retirement Savings
One of the most important and successful innovations in the past four decades has been the widespread adoption of 401(k) defined contribution plans. The average tenure of an employee is now just a few years, and 401(k) plans provide individuals the portability and flexibility combined with significant tax incentives to reward saving for retirement. As of 2014, over $4 Trillion is now saved in 401(k) plans*, and while many of these plans still suffer from high fees and poor investment options, there is no question that all progressive employers provide retirement savings as part of their basic financial benefits.
As it turns out, however, there are quite a few large financial goals that fall outside of retirement. Unfortunately, to date, companies have done almost nothing to help provide a simple, tax-efficient solution for their employees to build savings outside of tax-deferred retirement accounts. We believe an automated investment service, like ours, is the perfect solution to help employees automate their savings. It’s also a great way to help encourage employees to save windfalls, like bonuses, in a liquid form rather than spending them.
Wealthfront accounts are low-cost and tax-efficient. With automated deposits, an employee can set up her savings plan with similar convenience to her retirement plan. When an employee makes a deposit, she doesn’t have to worry about which asset class to invest in. Wealthfront uses every deposit to rebalance her portfolio. When the employee makes a withdrawal, she doesn’t need to figure out which shares to sell. Wealthfront automatically ensures that every withdrawal minimizes the taxes owed and keeps your portfolio balanced. Features like daily rebalancing, intelligent dividend reinvestment and tax-loss harvesting allow employees to focus on their careers and their families and place their long-term savings on automatic.
Palantir: A Case Study
Palantir is known for building data analysis platforms for both commercial and government use at previously unheard of levels of scalability, security and collaboration. As a company that believes its most valuable asset is its people, Palantir is well known in Silicon Valley for its exceptional employee benefits. We’re proud to partner with them on the rollout of Wealthfront for the Workplace.
At Palantir, every employee will now have the option to open a Wealthfront account and have up to $100,000 in investments managed for free. Wealthfront’s low fee of 0.25% will be covered directly by the company.
Every Employee Deserves Sophisticated Financial Advice
2014 has been a record-breaking year for Wealthfront, as millennial investors have overwhelmingly made us the largest and fastest-growing automated investment service in the country. With more than $1.4 Billion under management from clients in almost every imaginable profession living in all 50 states, we’re excited to be working with forward-thinking companies to extend the benefits of automated investing to an even broader audience.
Please contact us if you are interested in offering Wealthfront as a benefit at your company.
*Source: Investment Company Institute, 2014 Investment Company Fact Book
About the author(s)
Adam Nash, Wealthfront's CEO, is a proven advocate for development of products that go beyond utility to delight customers. Adam joined Wealthfront as COO after a stint at Greylock Partners as an Executive-in-Residence. Prior to Greylock, he was VP of Product Management at LinkedIn, where he built the teams responsible for core product, user experience, platform and mobile. Adam has held a number of leadership roles at eBay, including Director of eBay Express, as well as strategic and technical roles at Atlas Venture, Preview Systems and Apple. Adam holds an MBA from Harvard Business School and BS and MS degrees in Computer Science from Stanford University. View all posts by Adam Nash