Higher Ed. Institutions Partner with Advisers

Transamerica Retirement Solutions found that an increasing number of higher education institutions are seeking the services of financial advisers and consultants to enhance the retirement readiness of their employees.

In Transamerica’s study, “Retirement Plans for Institutions of Higher Education,” 42% of institutions surveyed currently use an adviser or consultant, and this trend is expected to grow by 10% over the next year. The survey findings show advisers perform a wide range of functions for higher education institutions, including selecting investment options (58%), monitoring investment options (47%), assisting with plan design (42%), developing the plan’s investment policy and selecting vendors (36%), and reviewing plan compliance (33%).

Though on-site participant counselors are not so common in the corporate world, such visits are routine for higher education institutions. Private institutions (59%), those with fewer than 5,000 eligible employees (58%), those with multiple vendors (60%), and those partnering with an adviser (58%) are most likely to have an on-site participant counselor. With these on-site visits, higher than average contribution levels, and up-to-date plan design, the higher education industry has made significant strides to improve the retirement security of plan participants. On average, participants defer 13.4% of their pay to defined contribution plans.

“Advisers and consultants are powerful allies in retirement plan management,” said Brodie Wood, vice president and national practice leader, not-for-profit for Transamerica Retirement Solutions. “By increasing the use of advisers, higher education institutions can continue to effectively navigate the many changes taking place regarding retirement plans.”

The report focuses on institutions that offer either a 403(b) or Roth 403(b) plan, which represents the vast majority (96%) of higher education institutions. The report also provides an in-depth view across plans and providers, offering a level of detailed plan benchmarking not otherwise available.

Transamerica will host a webinar for financial advisers to reveal further findings of the study September 10 at 2:00 p.m. Eastern Time. Financial advisers can register for the webinar by calling Transamerica at (888) 401-5826 and selecting option one, Monday – Friday, 9:00 a.m. – 7:00 p.m. Eastern Time.

To request a copy of “Retirement Plans for Institutions of Higher Education” e-mail marketinsights@transamerica.com