PLANADVISER - January/February 2022 - 32

improving outcomes / plan aggregation
The Full View
W
the retirement
The merits of pulling in participants' external financial information
hatever term one chooses to employ- " The Great
Quit, " " The Great Resignation, " The Great Job
Hop " -a significant number of workers are changing
jobs these days. All told, according to global job site Indeed,
during the last seven months of 2021, 38 million workers
quit their jobs. Some of those may be job switchers, leaving
low-wage industries such as food service for higher pay, and
some may be the millions of workers who still sit on the
sidelines. A wealth of questions and conversations spring
from these numbers.
But, for retirement plan advisers, one of the critical takeaways
may be the fact that many Americans have tax-qualified
retirement assets saved in defined contribution (DC)
plans operated by a prior employer.
This simple fact raises some important questions for
industry to ponder: Should plan advisers
encourage participants to consider consolidating their
retirement accounts? And, short of promoting account
consolidation, how can advisers work with plan sponsors
and providers to ensure they have a full view of participants'
savings, including assets held outside the workers'
current plan?
Consolidation vs. Cash-Outs
According to David Stinnett, principal and head of Vanguard
Strategic Retirement Consulting, part of The Vanguard Group,
in Dallas, some workers may actively decide to remain in
their previous employer's DC plan, based on factors such as
availability of specific investments or advantageous pricing
offered by the plan. Yet, many others simply postpone or
forgo account consolidation due to inertia, or because they
are unaware they have this way to move their money.
The most problematic outcome, Stinnett says, is when
participants overlook the consolidation opportunity and opt
for a cash-out. Fortunately, cash-outs are not the norm, but
they are also not exactly rare, at least in Vanguard's recordkeeping
universe. This means advisers can help plan sponsors
to discourage cash-outs in situations other than financial
emergencies or severe hardships.
" A majority of participants-83%-preserved their retirement
assets when leaving an employer, by either remaining
in their prior plan or by rolling their assets over to an IRA
[individual retirement account] or other qualified plan, "
Stinnett says, citing data from Vanguard's " How America
Saves, 2021 " report.
32 | planadviser.com January-February 2022 Art by Daniel Shaffer

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PLANADVISER - January/February 2022

Table of Contents for the Digital Edition of PLANADVISER - January/February 2022

The Virtual Reality
Getting to Yes
A Share of the Wealth
The Full View
Life Happens
An Objectivity Lesson
Best Execution Standard
PLANADVISER - January/February 2022 - Cover1
PLANADVISER - January/February 2022 - Cover2
PLANADVISER - January/February 2022 - 1
PLANADVISER - January/February 2022 - 2
PLANADVISER - January/February 2022 - 3
PLANADVISER - January/February 2022 - 4
PLANADVISER - January/February 2022 - 5
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PLANADVISER - January/February 2022 - 14
PLANADVISER - January/February 2022 - 15
PLANADVISER - January/February 2022 - 16
PLANADVISER - January/February 2022 - 17
PLANADVISER - January/February 2022 - The Virtual Reality
PLANADVISER - January/February 2022 - 19
PLANADVISER - January/February 2022 - 20
PLANADVISER - January/February 2022 - 21
PLANADVISER - January/February 2022 - 22
PLANADVISER - January/February 2022 - 23
PLANADVISER - January/February 2022 - Getting to Yes
PLANADVISER - January/February 2022 - 25
PLANADVISER - January/February 2022 - 26
PLANADVISER - January/February 2022 - 27
PLANADVISER - January/February 2022 - A Share of the Wealth
PLANADVISER - January/February 2022 - 29
PLANADVISER - January/February 2022 - 30
PLANADVISER - January/February 2022 - 31
PLANADVISER - January/February 2022 - The Full View
PLANADVISER - January/February 2022 - 33
PLANADVISER - January/February 2022 - 34
PLANADVISER - January/February 2022 - 35
PLANADVISER - January/February 2022 - Life Happens
PLANADVISER - January/February 2022 - 37
PLANADVISER - January/February 2022 - An Objectivity Lesson
PLANADVISER - January/February 2022 - Best Execution Standard
PLANADVISER - January/February 2022 - 40
PLANADVISER - January/February 2022 - Cover3
PLANADVISER - January/February 2022 - Cover4
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