Before the pandemic struck, sponsors of U.S. defined contribution plans were realizing the benefits of calling outside assistance for guidance. Even more seem to be doing so today. Relying on consultants and financial professionals for the very specialized help they provide can help sponsors weigh options. What’s more, it may provide a level of protection for those with authority over the plan, and may improve the plan’s performance.
The 2020 Inside the Minds of Plan Sponsors survey found that 58% of plan sponsors rely on a consultant or financial professional — up 16% from the prior survey. One benefit of expert guidance seems to be increased awareness of fiduciary responsibility: the survey found that 70% of plan sponsors now identify themselves as fiduciaries, up from 58% in the prior report. There was a similar increase in the number of plan sponsors who said it is “very important” to have a consultant to the plan acting as a fiduciary; 54% made that statement in 2020, compared to 37% in the earlier survey.
For plan sponsors, a lack of knowledge about how much employees need to save for retirement tops the list of worries, with 52% citing it as number one. Their second-highest concern, at 49% of plan sponsors, is that participants don’t understand their investment options. These are, of course, areas where outside financial professionals can help.
To read the latest Inside the Minds survey from Alliance Bernstein, visit: https://blog.alliancebernstein.com/library/for-dc-plans-pandemic-reinforces-value-of-consultants-and-advisors.
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Heartland Retirement Plan Services are offered through Dubuque Bank and Trust Company. The information provided herein is general in nature and is not intended to be nor should be construed as specific investment, legal or tax advice. The factual information has been obtained from sources believed to be reliable, but is not guaranteed as to accuracy or completeness. Heartland Retirement Plan Services makes no warranties with regard to the information or results obtained by its use and disclaims any liability arising out of your use of, or reliance on, it. Products offered through Heartland Retirement Plan Services are not FDIC insured, are not bank guaranteed and may lose value, unless otherwise noted.
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© 2020 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance, nor as the sole authority on any regulation, law, or ruling as it applies to a specific plan or situation. Plan sponsors should always consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.