Data & Research November 19, 2012

Put it on Paper

Three out of four adults said they prefer to receive retirement plan information on paper.

Reported by

Asked if they had to make a choice between receiving retirement plan information on paper or electronically, only 23% would want to receive this information via email, with a link to an online website, a survey by AARP found.

Interestingly, the preference for paper was overwhelming for all age groups, even those who use the Internet daily, according to the survey of 1,028 adults age 25 and older, conducted by Social Science Research Solutions. However those age 50 and older are more likely to prefer paper (84%) than those under the age of 50 (66%).

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Of those who have email addresses, 70% said they would be likelier to read their retirement plan documents if they received them on paper, and another 73% said they would be likelier to save hard-copy reports.

Currently, just 7% of respondents receive retirement plan documents electronically only. The majority, 62%, receive the information by paper only; just over a quarter, 27%, get the information both online and in hard copy.

AARP said it conducted the survey, between October 12 and 21, in response to pending legislation, including House of Representatives bill HR 4050, that would permit plan sponsors to make electronic delivery of retirement plan documents the default.

“AARP has long had concerns about this approach, and our new survey indicates that the public shares those views,” said Cristina Martin Firvida, director of financial security issues in government affairs at the AARP. “Retirement plan participants of all ages overwhelmingly prefer a policy that requires retirement documents to be delivered in paper form, with an option to choose electronic delivery—rather than the other way around.”

Data & Research November 16, 2012

Institutional Market to Soar to $18T

The U.S. institutional market is projected to increase 36%, to $18 trillion, within the next five years.
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Cerulli Associates defines the institutional market based on the identity of the end-client, classifying assets as institutional only when the asset manager’s end client is an institution.

The U.S. institutional market weathered two major bear markets following the tech bubble burst in 2000 and the more recent global financial crisis, yet the market has shown steady growth, said Michele Guiditta, associate director at Cerulli. “As of year-end 2011, the institutional market held $13.2 trillion in assets under management,” Guiditta said.

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In the report, U.S. Institutional Markets 2012, Cerulli looks at the entire industry, summarizing trends and revealing opportunities and challenges the industry faces. The report also analyzes service and product strategies, as well as the implementation of effective sales strategies.

In the past two decades, according to Guiditta, defined contribution (DC) plans have begun replacing defined benefit plans (DB) in retirement vehicles. “With over $3.5 trillion in assets, private defined contribution (DC) is the largest U.S. institutional market,” Guiditta said.

“DC markets have grown faster than DB markets,”said John Hsu, senior analyst at Cerulli. “And we expect that trend to continue over the next five years. There is an opportunity for asset managers to continue to grow their assets in the 401(k) market, which comprises more than 90% of the corporate DC market by assets.”

Cerulli cites other opportunities with alternative products and investment consultants in the institutional market, as well as challenges asset managers face with endowments and foundations.

The report is available for purchase by contacting CAmarketing@cerulli.com.

 

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