Perspectives

Outside Advisor Usage by Defined Contribution Participants.

How do plan participants make decisions regarding their retirement plan assets?  Do they work with an outside advisor to determine the appropriate asset allocation or rely upon the advisors provided by the plan sponsor? 

Investment Education and Advice

While plan participants in 2012 consider themselves fairly knowledgeable about investments compared to just a few years ago, their opinions regarding the tools and communication materials available by plan providers indicates they are somewhat lackluster. 

Asset Allocation of Plan Participants

Just a few years ago, plan participants used just three funds to invest their retirement plan money.  Today, they are using from five to six funds.  Is this due to a broader range of options offered or is is a result of lessons learned as to the value of diversification delivered during the financial crisis of 2008?  What effect has investment education had on asset allocation decisions?  This report explores which factors are driving asset allocation decisions today.

Retirement Income

More than 20 million individuals will reach retirement age over the next five years. A large portion of these represent mass affluent households, those with a net worth not including their primary residence of $100,000 to $1 million. How are these households planning to structure their financial lives in retirement? Does the market crash of 2008 mean that they will be adverse to leaving their nest-egg exposed to the fluctuations of the market? If so, will that translate into a bonanza for annuity providers? Or, will they be seeking out advisors to help them identify other approaches for controlling risk and maintaining the level of income they need?

Baby Boomers

The impact of the recession on the largest U.S.  generation, soon to face retirement, has been complicated. Torn between  protecting the principal they had left after the market downturn yet desperate  for their assets to return to pre-recession levels, their attitudes and  behaviors are mixed.

Small Defined Contribution Plan Market

Within the retirement plan industry, companies with fewer than 250 employees hold the best opportunity for growth for plan providers. It is much easier for sponsors in the small defined contribution plan market to switch providers than in the larger markets. A deeper understanding of their preferences can help improve providers’ effectiveness and plan sponsor retention.

Investment Education

Although plan providers have made a considerable investment in investment education, plan sponsors have been consistently underwhelmed by the effectiveness of the programs among their participants.  So, what's missing and where are the missed opportunities that could lead to greater plan sponsor satisfaction?  Which segments of participants benefit most from an investing curriculum and have they reaped any benefits?  This report addresses the specific information, techniques and channels that are most effective with participants.