Client Service

Advisers Compete for Benefits Dollars and Time

New research from Fidelity warns that plan sponsors’ increasing focus on health care is cutting back the amount of money and time they have to devote to retirement benefits; satisfaction with advisers is also up. 

By John Manganaro | August 30, 2017
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Fidelity Investments announced the results of its eighth annual Plan Sponsor Attitudes survey, which revealed that a sizable majority of plan sponsors (65%) are highly satisfied with their plan advisers.

However, similar to the last several editions of the survey, Fidelity reports that a record number of plan sponsors are actively looking to switch their plan advisers. Nearly four in 10 (38%) sponsors suggest they are actively looking for a new adviser, up from 30% last year. The ongoing study, which began in 2008, surveys employers who offer retirement plans that use a wide variety of recordkeepers and have at least 25 participants and $10 million in plan assets.

Even with the strong marks from sponsor clients, Jordan Burgess, head of specialist field sales overseeing defined contribution investment only sales at Fidelity Institutional Asset Management, warns that this is not the time for advisers to lay back and rest on their accomplishments.

“While most plan sponsors remain satisfied with their advisers, they are raising their expectations,” he explains. “For some advisers, this could put their business at risk. For others, this could be an opportunity to win new clients.”

Burgess says the data is clear: “Successful plan advisers are those who are aware of their dual mandate to help plan participants achieve their retirement outcomes and to support plan sponsors with the challenges associated with offering a defined contribution plan and other employee benefits.”

Other findings show “reducing business costs related to having a plan” is the top concern for plan sponsors, with 31% citing it as an area of focus. Other important themes for plan sponsors include managing their fiduciary responsibility (23%), preparing employees for retirement (22%) and the risk of litigation and liability (18%).

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