Products October 12, 2023

Investment Product & Service Launches – 10/12/23

PGIM enhances target-date funds; Pantheon announces new private credit secondaries fund; Morgan Stanley at Work launches charitable giving solution; and more.

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PGIM Announces Enhancement to Target Date Funds

PGIM announced plans to enhance its suite of target-date funds to better serve shareholders, including defined contribution plan participants, and their retirement outcomes.

Primary enhancements to the suite of mutual funds and collective investment trusts include:

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  • New name: Currently branded as the Prudential Day One Funds, the funds will be renamed the PGIM Target Date Funds;
  • Lower fees: PGIM is lowering the net expense ratio for the target-date mutual funds to 0.25% from 0.40%. In addition, the expense ratio for the institutional share class of the CITs is expected to drop to 0.19% from 0.34%; and
  • Adjustments to underlying investments: PGIM will replace select underlying actively managed equity strategies with passively managed equity strategies. This will offer a blend of active and passive management to keep investment expenses low, while providing the ability to add value and mitigate risks with active management.

Pantheon Expands US Private Wealth Offering With Private Credit Secondaries Fund

Pantheon, a private markets investor owned by Pantheon Partners, announced it has filed for registration an evergreen private credit fund anchored in private credit secondaries.

The AMG Pantheon Credit Solutions Fund will be the latest addition to the firm’s growing evergreen platform. It will be the first of its type to deliver a private credit secondaries-focused investment strategy to the U.S. private wealth market.

Abbreviated as PSECC, the fund is designed to offer prospective investors a core private credit exposure, diversified by manager, vintage year, industry sector and company. The fund seeks to acquire and build a carefully selected portfolio of high-quality, performing private credit at discounted pricing, providing the potential to generate strong, risk-adjusted total returns with an attractive income stream.

“We are excited about extending our position in private credit secondary solutions to this important and growing client channel.” Rakesh Jain, Pantheon partner and global head of private credit, said in a statement. “We see a strong opportunity for investors to capitalize on the supply-demand imbalance of capital and expertise in this space, similar to the evolution of secondaries across private equity, infrastructure and real assets.”

Morgan Stanley at Work Launches Charitable Giving Solution

Morgan Stanley at Work, a provider of workplace financial solutions, announced a new charitable giving solution that simplifies the ability of corporate clients and their employees to donate through a donor-advised-fund platform.

Companies can open and manage their own corporate giving account directly on the platform and distribute giving credits to their employees, empowering employees to contribute to charities of their choosing.

In addition, the Charitable Giving Program allows employees to open an individual giving account and amplify personal charitable giving.

“As more candidates seek employers that align with their own personal values, this benefit is a timely addition that helps foster a culture of giving within organizations,” Brian McDonald, head of Morgan Stanley at Work, said in a statement. “While, traditionally, donor-advised funds may be reserved for the executive ranks, this solution democratizes access to these vehicles and allows employees to contribute regardless of their financial situations.”

Alera Group Makes FiduciaryRx Platform Available Nationally

Alera Group, an independent national insurance and financial services firm, announced a partnership with FiduciaryWor(k)s that makes available the FiduciaryRx platform across Alera Group Retirement Plan Services’ national footprint.

“The FiduciaryRx platform unifies key workflows and heightens collaboration among our retirement-plan advisors and their peers in other Alera Group divisions, including Employee Benefits and Wealth Services,” Christian Mango, executive vice president and national practice leader of retirement plan services, said in a statement.  

FiduciaryRx is a modular platform providing fiduciary advisers with workflow and data enhancements across fiduciary management, cost management, committee management and practice benchmarking.

“Alera Group’s approach to serving retirement plans emphasizes individualized consulting, not cookie-cutter ‘solutions,’” Josh Itzoe, founder and CEO of FiduciaryWor(k)s, said in a statement. “FiduciaryRx is helping its advisors zero in on issues prospective clients are grappling with and start productive conversations.”

Client Service October 12, 2023

How to Champion a Financial Wellness Plan

Experts recommend implementing metrics for success and maintaining regular outreach.

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While there is no blanket solution for financial wellness, advisers can recommend creating a metric for success, celebrating small wins and offering consistent communication, experts said at the “The Financial Security Journey” session of PLANSPONSOR’s Roadmap livestream event.

To identify plan priorities, Jake Spiegel, a research associate at EBRI, said participants’ wide array of backgrounds must be part of the solution.

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“We all have identities that aren’t as unique as our own fingerprints,” said Spiegel. “Everybody’s got diversities, and so there is just not going to be a one-size-fits-all solution.”

He provided the example of a participant population that might seem homogenous, such as a tech company, where everyone is relatively young and highly compensated. However, in reality, one worker might have to care for an elder, another worker might have huge student loan debt, and another worker might have a child with special needs.

Spiegel said the right benefits to include in a plan will depend on how a company defines success. From his experience, he observed that many employers are looking to create financial wellness metrics and use them to direct more resources toward successful projects.

“They’re looking to measure things like, ‘Do people participate in this program?’ ‘Do we increase retention this way?’ There’s a huge appetite for employers to develop these sorts of metrics and justify their financial spending,” he said.

Monica De Agostino, manager of benefits, compensation and human resources information system at MRIGlobal, agreed there is no right formula to creating a financial wellness plan, but she believes in celebrating the minor wins.

“Complexity leads to inertia, and when we’re talking about financial wellness, we’re dealing with—at the bottom of it—human behavior,” said De Agostino. “Changing behavior is a long-term gig. Especially in the beginning, accomplishments are going to feel small, the milestones can fade in and out very quickly. It can feel like they were not really making any progress, but you actually are in creating that conversation.”

De Agostino went on to say that small wins can lead to better outcomes for employees. She said in 2021, the MRIGlobal HR committee sat down together to look at securing retirement for their 450 employees.

“We had a couple of different plans,” she said. “We had a matching and nonmatching contribution. The nonmatching contribution was a complicated formula. I said, ‘We have to explain it in 10 seconds or less, or it loses momentum again or actually leads to inertia.’ That’s how we came up with the 100% dollar-for-dollar formula and focused on the match.”

The committee put its dollars into the match, rolled the solution out and immediately saw contributions rise. Older employees advised their younger counterparts to jump in on the match, and the participation rate peaked at 98%. In addition, the project ended up being budget-neutral.

“To this day, we have really high savings rates,” she said. “Because at the end of the day, people just really enjoy, at least in our population, the match.”

Jeff Petrone, managing director at SageView Advisory, emphasized again that there is no one silver bullet strategy that works for every single group, but across-the-board programs that have seen the most success have had “champions” like De Agostino driving the initiatives for their employer and workforces.

“[They] want those initiatives to be successful, who spend the time to craft a communication plan that’s not just once a year, but continually reaching the employees to make them aware of those resources,” said Petrone. “They’re working department by department, working division by division, sending things out to employees continually throughout the year.”

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