If client retention looms large, and fee compression is a growing concern, are advisors tracking profitability on a per-plan basis?
Well, according to a unique survey of more than 500 advisors who participated in the 2018 NAPA 401(k) SUMMIT Insider, a slight plurality – but less than a third (31%) – said they were, and while nearly as many (27%) said that they were… sometimes, 42% weren’t doing so. Though that was split between 20% who said they weren’t now, and 22% who indicated they weren’t… yet.
We also asked advisors about the proportion of fee/service compared with two years ago. Considering the concerns about fee compression, one might expect that “less fee for more service” would have been the “norm” – and yet, that was the case for only about one in five (21%).
Instead, the most commonly cited status (though far from a majority) was “charging more for more service,” which was cited by 37% of the respondents, though nearly as many (33%) were charging less for the same service.
