PLANADVISER - July/August 2018 - 32

person's] salary, tenure and gender, rather than just autoenrolling
everyone at a 6% deferral rate, " Murphy adds.
" Maybe younger employees carrying student loan debt
should be automatically enrolled at 1% so they can focus on
solving that problem. "
Technology Integration
Investment in data analytics provides not just results but
ways for advisers, plan sponsors and participants to use
them. " As the world has become more digital, major recordkeepers
are investing in digital to deliver personalized solutions,
starting with the use of a person's name in communications
and understanding that person and where he is on
his journey to retirement, " says Amy Vaillancourt, senior
vice president of client relationship management, small/
mid corporate markets, at Voya in Windsor, Connecticut.
For example, Voya provides personalized videos for
participants. " We find more and more that video is a great
way to reach participants, particularly
younger people, " Vaillancourt says.
Jason Grantz, director of
institutional
retirement consultants at Unified
Trust Co. in Lexington, Kentucky, says
the retirement calculators that recordkeepers
now offer " are more intuitive
than the ones previously offered. They
ask participants for a set of data, and
that will algorithmically lead them to a
set of questions tailored to their specific
situation. "
Whereas in the past five years only a
handful of recordkeepers offered mobile
apps for participants, today these are
far more common. " Most of the recordkeepers
now have mobile-based apps, "
says Janet Ganong, a partner and retirement
plan consultant with The KieckInvestment
Accommodations
Recordkeepers continue to evolve their investment offerings
as well. Whereas in the past, the majority offered
only a limited number of investments, many today have
open architecture platforms that permit a retirement plan
adviser to select the best funds for a particular plan from
the entire universe of mutual funds, says Jason Lumpkin, a
shareholder with Schneider Downs & Co. Inc. in Pittsburgh.
" Recordkeepers are pushing their own target-date funds
[TDFs] less than they used to, and open architecture is
becoming more common, " agrees James Sullivan, vice president
at Essex Financial in Essex, Connecticut.
In addition, many recordkeepers are offering collective
investment trusts (CITs), which have lower fees, as well
as platforms that allow advisers to build model portfolios,
or managed accounts with more customized features,
including downside protection, Acheson says.
" Many recordkeepers are considering being able to
" We find more
and more
that video
is a great
way to reach
participants,
particularly
younger people. "
hefer Group in Brookfield, Wisconsin. " That is really where
the participant is connecting with the recordkeeper to do
basic functions, such as looking at his balance and transaction
history. Very few [apps] allow for transactions, due to
security concerns. "
However, Voya's mobile apps do allow participants to
make transactions, Vaillancourt says.
Grantz agrees that " recordkeepers that are going to
remain in business must offer digital apps and continue to
develop new [ones]. "
Financial wellness is also sometimes being included as
part of an integrated package from recordkeepers. " Recordkeepers
are providing more bells and whistles associated
with financial wellness, such as calculators participants
can use to make sure they are on track for a successful
retirement, " Ganong says.
Voya has incorporated its financial wellness platform
into its digital platform, and it allows participants to look at
their entire financial life holistically, including budgeting,
emergency savings, retirement and saving for other goals,
Vaillancourt says.
support lifetime income products, "
says Tim Slavin, senior vice president,
retirement, at Broadridge in New York
City. " Many show participants on their
statements how their balances will
turn into projected lifetime income,
and the natural next step is to offer
annuities. I think you are going to see
them offered from day one, rather than
when a participant reaches his 50s.
You're seeing a lot of the larger insurance
firms going down that route. "
As far as lifetime income products
are concerned, John Hancock Retirement
Plan Services has a group annuity
platform that it offers to both defined
benefit (DB) and defined contribution
(DC) plans, Murphy says. The firm is
also working on the next generation
of managed accounts that will turn balances into lifetime
income; these will be rolled out later this year, he says.
In addition, Voya, like a number of insurers, launched a
lifetime income product following the Great Recession, Vaillancourt
says.
Platforms will continue to evolve, as a requirement for
surviving in such a competitive industry. " I have been in
this business for 22 years, and I don't remember a time
when the competition has been as steep as it is, " Grantz
says. " It has become harder to get a client to transition a
plan from one recordkeeper to another. I expect that, due
to consolidation and fee compression, within a few years,
midsize recordkeepers will exit the business, and we will
see a smaller number of 'super recordkeepers' with huge
numbers of plans on their books. "
The industry is " extremely competitive, " Slavin agrees.
" A lot of firms are doing roll ups and purchases. Large firms
are getting larger. Technology is key when you're in the
recordkeeping business. Those investing heavily in technology
will be the winners. " -Lee Barney
32 | planadviser.com july-august 2018
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