Products June 20, 2018

Benefit Consultants Relaunches AdvisorEdge Practice Management Platform

It offers advisers prospecting tools, plan management resources, including fiduciary support, and educational materials.

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Benefits Consultants Group has relaunched its AdvisorEdge Practice Management platform for 401(k) advisers.

It is designed to offer advisers full turnkey practice management support and information to acquire leads and grow business. It offers rospecting tools, plan management resources, extensive educational materials library and sales support library and resources.

“AdvisorEdge provides financial professionals a practical and impactful set of tools and resources to deliver a best-in-class client experience for qualified plans,” says Beau Adams, executive vice president at Benefit Consultants Group. “AdvisorEdge balances comprehensive technology, proven best practices and the expertise of plan consultants to help advisers throughout the entire sales and service cycle.”

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The platform uses Form 5500 data to compare plan health and performance to similar plans, as well as to help advisers with prospecting, and it also offers fiduciary best practices and live consulting support.
The Markets June 20, 2018

401(k) Participant Mutual Fund Expense Ratios Declined Substantially Since 2000

The Investment Company Institute also found 401(k) plan participants investing in mutual funds tend to hold lower-cost funds.

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The downward trend in the expense ratios that 401(k) plan participants incur for investing in mutual funds continued in 2017, according to Investment Company Institute (ICI) data.

According to the report, “The Economics of Providing 401(k) Plans: Services, Fees, and Expenses, 2017,” the average expense ratio 401(k) plan participants incurred for investing in equity mutual funds fell from 0.48% in 2016 to 0.45% in 2017. The average expense ratio 401(k) plan participants incurred for investing in hybrid mutual funds fell from 0.53% to 0.51%, and the average expense ratio 401(k) plan participants incurred for investing in bond mutual funds fell from 0.35% to 0.33%.

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The expense ratios 401(k) plan participants incur for investing in mutual funds have declined substantially since 2000, the data shows. In 2000, 401(k) plan participants incurred an average expense ratio of 0.77% for investing in equity mutual funds. By 2017, the average expense ratio experienced a 42% decline. The average expense ratios that 401(k) plan participants incurred for investing in hybrid and bond mutual funds also fell from 2000 to 2017, by 29% and 46%, respectively.

According to the report, 401(k) plan participants investing in mutual funds tend to hold lower-cost funds. At year-end 2017, 401(k) plan assets totaled $5.3 trillion, with 40% invested in equity mutual funds.

ICI says it uses asset-weighted averages to measure the expense ratios that mutual fund investors actually incur for investing in mutual funds. The simple average expense ratio, which measures the average expense ratio of all funds offered for sale, can overstate what investors actually paid because it fails to reflect the fact that investors tend to concentrate their holdings in lower-cost funds.

401(k) equity mutual fund investors tend to pay lower-than-average expense ratios than for the industry. In 2017, the asset-weighted average expense ratio for all investors in equity mutual funds was 0.59%, while for 401(k) equity mutual fund investors, it was 0.45%.

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