Noriyoshi Yamaguchi is a 401 – man.
Yamaguchi played a key role last September in the introduction of a new type of pension — similar to the 401(k) plans used in the United States — at Pasona Inc., the major temporary-staff agency in Tokyo where he works.
Currently leading the in-house “401k Team,” he manages new pension-related projects targeting the general public and potential corporate customers. The first project will appear online.
Pasona and To-Shin Ichiba Corp., the operator of a portal site on investment trusts, will jointly launch the 401k Net site on June 20.
The site is intended to help viewers learn about existing public and private pension plans as well as the government-planned new private pension scheme.
The site will also provide an e-mail magazine, a bulletin board for discussions by members and a calculator to assess pension benefits for each viewer under the new system.
“We are going to provide services from the individuals’ standpoint,” Yamaguchi said, although the site will also explain specific financial products that could be useful in managing pensions. He added that he hopes as many as 10,000 people sign up by the end of this year.
But since the use of such online services is basically free and revenue depends on advertisements, the online project alone will probably be “barely profitable enough to avoid red ink,” he said.
So the real profit opportunities lie in pension-education services that Pasona plans to begin for corporate customers later this year. The Web services can supplement lessons to be given by instructors dispatched by the firm, he said.
Assuming 200,000 workers across the nation use Pasona’s education services and corporate customers spend 30,000 yen per employee for pension-related education, the expected yearly revenue will add up to 6 billion yen, according to Yamaguchi’s simulation.
The government plans to set up a legal framework for Japanese-style 401(k) private pensions early next year, although related bills have been shelved since the Lower House was dissolved earlier this month.
Under the new scheme, individual participants — corporate workers and the self-employed — will choose from various investment options, such as investment trusts and insurance products. Benefits will depend on the results of these investments, unlike conventional plans, which basically guarantee fixed benefits.
The self-selection process will require some knowledge of financial products and risk management. That’s why there is demand for education services.
Pasona’s own version of the 401(k) is being used by some 180 people, including temporary staff registered for dispatch and the firm’s full-time workers, even though no tax incentive is available yet.
Yamaguchi said he can apply the knowhow he has learned through creating this pension for the planned online and off-line education services.
His ideas, however, are not limited to retirement plans: he is planning a consultation service on career development on 401k Net.
For example, if someone wants to increase annual income from 6 million yen to 10 million yen by moving from one firm to another, Pasona will try to identify the skills that will be necessary for the change, Yamaguchi explained.
“Your retirement funds and your current salary can’t be considered separately,” he said, because the retirement funds change if the salary changes.