Retirement Plan Sponsors Want Financial Professionals To Adjust Focus

The majority of retirement plan sponsors rely heavily on projected participant outcomes—whether participants can retire successfully to gauge the success of their plans. But they’re not sure their financial professionals are on the same page. That’s according to new research from the Principal Financial Group ®.

Nearly two-thirds (63 percent) of plan sponsors measure the success of their plans by participants’ abilities to stay on track for a successful retirement. But less than half of those surveyed say their financial professionals attach the same importance to that metric.

“This is a clear opportunity for financial professionals to demonstrate their value,” said Tim Minard, senior vice president, The Principal ®. “By expanding their focus and diving deeper into plan evaluation, financial professionals can build stronger practices and create loyal followings of highly satisfied clients.”

Supporting Retirement Savings, a national survey of more than 280 sponsors of 401(k) plans, was conducted by Brightworks Partners on behalf of The Principal Knowledge Center. The survey revealed that sponsors want financial professionals to help with plan design:
  • Plan sponsors believe their financial professionals are more focused on having a high participation rate (64 percent) and an attractive fund line-up (63 percent) than plan outcomes.
  • Plan sponsors are overwhelmingly (76 percent) open to consulting with financial professionals on plan design to help improve participant outcomes.
  • Two-thirds of plan sponsors expect their financial professionals to be aggressive in promoting outcome-focused retirement income planning.

“Financial professionals who focus on fees, funds and fiduciary responsibility may not be focusing enough on participant outcomes,” said Minard. “The survey shows that plan sponsor clients—and prospects—want to work with financial professionals who are as concerned as they are about the end game: how well participants will be prepared to afford a comfortable retirement.”

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