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Others (8%) base their views on whether custom is appropriate for the situation based on specific client factors. Nearly three-quarters (74%) of firms believe it makes sense for plan sponsors with $500 million or less in plan assets to consider creating their own custom strategies. Only 8% of firms believe $1 billion or more in plan assets is needed for custom strategies. Over two-thirds (71%) of consultants believe that a custom approach to target-date funds would improve current packaged products. Less than one-quarter (21%) believe there is plenty of choice among current packaged target-date funds. Consultants believe the top three reasons not to implement custom strategies are difficulty of operational setup, time required to implement and fear of liability, insufficient asset size and asset allocation setup and oversight is too demanding. In order of importance, consultants report that plan sponsors consider these factors as they evaluate target-date or target-risk strategies: glide path structure, fees, active vs. passive, breadth of underlying investment and performance. Consultants report the following as the most common approaches to benchmark target-date or target-risk strategies: peer group comparison, investment manager index composite and consultant-created index composite.
Others (8%) base their views on whether custom is appropriate for the situation based on specific client factors. Nearly three-quarters (74%) of firms believe it makes sense for plan sponsors with $500 million or less in plan assets to consider creating their own custom strategies. Only 8% of firms believe $1 billion or more in plan assets is needed for custom strategies.
Over two-thirds (71%) of consultants believe that a custom approach to target-date funds would improve current packaged products. Less than one-quarter (21%) believe there is plenty of choice among current packaged target-date funds.
Consultants believe the top three reasons not to implement custom strategies are difficulty of operational setup, time required to implement and fear of liability, insufficient asset size and asset allocation setup and oversight is too demanding.
In order of importance, consultants report that plan sponsors consider these factors as they evaluate target-date or target-risk strategies: glide path structure, fees, active vs. passive, breadth of underlying investment and performance. Consultants report the following as the most common approaches to benchmark target-date or target-risk strategies: peer group comparison, investment manager index composite and consultant-created index composite.