Most plan sponsors trust the advisors whose services they seek and secure. But the price of that confidence is an expectation that those advisors will work aggressively on behalf of participants. Those are among the results of a study by Brightwork Partners LLC for the Principal Financial Group. The study looked at the responses of 283 plan sponsors, all of which offer a 401(k), have more than 50 eligible employees and use the services of a paid professional to help them choose and monitor investment and service providers, design plans, conduct enrollment meetings and resolve problems with service providers.
Just over three-quarters of the plan sponsors — 76% — consult with an advisor regarding plan design as a way to improve service for participants. And they mean business about that advice: almost 85% said they want to spend more time assisting participants in planning their retirement income.
Brightwork also found that 66% of the plan sponsors it studied expect their advisors to be aggressive in promoting retirement income planning that’s centered on the outcome for participants. But the plan sponsors expect no less of themselves: 66% said that they gauge the success of their 401(k) plan by the extent to which it effectively prepares participants for their retirement.
The results suggest that the plan sponsors are not sure that their advisors’ priorities align with making participant outcome the primary concern. Strong majorities — 64% and 63%, respectively — think that their advisors’ main focus is on high plan participation rates and offering an attractive array of funds. What’s your reaction to all this? Share your thoughts in the comment box below.
