PLANADVISER - November/December 2022 - 2

publisher's note //
publisher: Alison Cooke Mintzer
Alison.Mintzer@issmediasolutions.com
Truly Participant Focused
T
hose in the retirement plan industry have
recently increased their focus on participants.
Retirement
plan
recordkeepers,
investment
managers, plan sponsors, and advisers and consultants
throw the word " outcomes " around extensively.
And, though the industry talks a lot about
outcomes, we don't seem fully clear on what the
word means-or maybe it means different things to
different people.
For the purposes of this column, let's assume that
" participant outcomes " refers to participants' ability to achieve their desired
replacement rate and to retire when, and in the way, they choose. If you look
at that meaning of the term, you'd think the industry isn't doing well. Average
account balances are much lower than what would be presumed necessary to
support people in retirement.
That's why some findings of the recent 2022 PLANSPONSOR Participant
Survey were surprising: The vast majority of respondents said they want to
retire " early " or at least earlier than what is full retirement age for them under
Social Security; further, the majority are also confident they will meet their
retirement needs, with two-thirds having a specific savings goal.
One thing worth noting is, as discussed in this issue's Data Points article
(see page 4), most of those saving in their employer plan intend to draw retirement
income from various sources. This means any single DC plan will likely
give a plan sponsor or retirement plan adviser a sense of only a fraction of
participant retirement assets.
If as an industry we want to be truly participant focused, we have to help
participants aggregate assets pegged for retirement to facilitate good financial
decisionmaking. This account aggregation should include EGTRRA [Economic
Growth and Tax Relief Reconciliation Act of 2001] rollover accounts, where assets
of under $5,000 may have been automatically transferred to an individual retirement
account outside of the plan when the participant left the employer.
Years ago, a leader of a top 10 recordkeeper, speaking at the PLANSPONSOR
National Conference, said, at some point, recordkeepers would have to allow for
information sharing or for a central system that allows access to information
about participant assets if the industry was going to solve for outcomes. His
compadres at the time disagreed, but I've always remembered how ahead-ofthe-time
that comment was. The time is still not here, but we're making progress.
I'm excited about the work being done by companies such as Retirement
Clearinghouse and the new consortium of Fidelity, Vanguard and Alight to help
participants aggregate assets.
Nevertheless, as retirement plan advisers, you don't need to wait for the
recordkeepers to participate in such a system to help participants improve
their own visualization of retirement. You can assist by encouraging plan
sponsor clients to consider what they may want to do about encouraging rollins
of other plan assets.
Helping participants consolidate assets makes your participant-level
services, your financial wellness services and the overall plan support more
valuable, because the metrics are more accurate. When you have only a portion
of a participant's financial picture, the advice and services require much more
participant engagement-for the individuals to tell you or the online tool where
other assets are invested, how many accounts they have, etc.-to be valuable.
If, at a minimum, you knew you were working with the entire DC portion of
assets, that would make the asset allocation and projections more accurate-
and, therefore, more meaningful. -Alison Cooke Mintzer, Publisher
creative director: SooJin Buzelli
SooJin.Buzelli@issmediasolutions.com
managing editor: Judy Faust Hartnett
Judy.FaustHartnett@issmediasolutions.com
editorial staff: Paul Mulholland, Alex Ortolani,
DJ Shaw, Karen Wittwer, Jonathan Yardley,
Noah Zuss
contributors: Beth Braverman, Debbie Carlson,
Elizabeth Harris, Kimberly Lankford, Bailey
McCann, Ed McCarthy, Judy Ward
surveys & research: Garrett Cox, Kimberley
Gonzalez-Quiles
design & production: Donna Bien-Aimé,
Alanna Jacobs, Maria Kofman, Samantha Yu
design contributor: Cherese Rambaldi
art contributors: Julia Rose Barnes, Tim Bower,
Alfonso de Anda, Karlotta Freier, Marcellus Hall,
Matt Kalinowski, Lars Leetaru, Miriam Martincic,
Parapaboom (cover), Irene Servillo
strategy & operations: Michelle Lamison;
Melissa Groccia, Rebecca Moore, Jackie Scott
commercial director: Rob Reif
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advertising sales: Katie Bacon, John Bennett,
Christopher Janos, Bill Murray
conferences: Carol Popkins; Katie Campbell,
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accounting operations: Mayrillane Bahi,
Ruth Fissaha, Ricky Kostik
technology operations: Darrell Cheng, Bhakti Patel,
Jigar Patel, Dexter Reaves
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chief financial officer: Allen Heery
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PLANADVISER - November/December 2022

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