Professional retirement plan advisors have significant impact on retirement plan performance

The study, The Value of a Professional Retirement Plan Advisor, was produced by EACH Enterprise and co-sponsored by Transamerica. It highlights how professional retirement plan advisors play a key role in the strategic direction, administration, and overall performance of the retirement plans they manage.

The study defines professional retirement plan advisors as those who work primarily or exclusively with retirement plans.

More than 400 retirement plan sponsors with plan assets between $5 million and $500 million were surveyed regarding their perceptions about advisors. The majority of those surveyed (61 percent) work with an advisor who is exclusively or primarily focused on retirement plans.

The majority of plan sponsors agreed that it is very beneficial to work with an advisor, due to their focus on improving retirement outcomes and retirement readiness, and their ability to simplify plan administration.

Focus on improving outcomes

Professional retirement plan advisors are focused on improving outcomes for plan sponsors and their participants. To this end, they implement a number of creative plan design adjustments such as changing employer match formulas, utilizing automatic enrollment, and increasing default deferral rates to achieve better plan results.

Retirement readiness

In addition to plan design changes, advisors also provide visibility into plan performance. New reporting at the participant and plan level has made it easier for plan sponsors to understand how plan design changes affect performance, and a majority of plan sponsors who work with an advisor reported positive results.

• Seventy-six percent of plan sponsors say more than half their participants are on course to achieve a successful retirement.
• More than 80 percent have experienced an improvement in participant deferral rates.
• Thirty-three percent reported a deferral increase of at least six percent in the last two years.

Ease of administration

Ninety percent of plan sponsors agree that their advisor simplifies plan administration, and when challenges arise, nearly 60 percent say they would turn to their advisor first in the event of a problem with plan administration.

To learn more about The Value of a Professional Retirement Plan Advisor, send an email request for the full report to marketinsights@transamerica.com.