Products November 21, 2024

Product & Service Launches

Oppenheimer partners with Pontera for client 401(k) management; SEI adds separately managed account options; AssetMarket adds TIFIN AI capabilities for advisers; and more.

Reported by

Pontera and Oppenheimer Partner To Incorporate Client 401(k)s

Oppenheimer & Co. will join the firms partnering with Pontera Solutions Inc. to manage clients’ workplace retirement accounts along with other assets.

The partnership will give Oppenheimer’s 928 financial advisers the ability to use Pontera to help manage clients’ 401(k) accounts; the firm has $129.8 billion in assets under administration.

Get more!  Sign up for PLANSPONSOR newsletters.

“We believe the Pontera platform gives our advisers greater clarity into their clients’ full financial picture,” Bryan McKigney, Oppenheimer Asset Management’s president, said in a statement. “By enhancing our technology stack for financial advisers, we continue to deliver a superior client experience, helping them to implement their overall wealth management strategy.”

Pontera noted that its system is certified under information security standards SOC 2 Type II and ISO 27001, designed to protect client data and prevent advisers from gaining direct access to their clients’ 401(k)s.

SEI Expands SMA Offerings in Equity and Fixed Income

SEI Investments Co. has launched a new lineup of separately managed account strategies through a program aimed at offering more equity and fixed-income investment options.

The additions include SEI-managed and third-party strategies from investment firms including AllianceBernstein, Loomis Sayles and Parametric Portfolio Associates.

SEI pointed out in the announcement that SMAs posted the strongest growth rate (24.4%) of any managed account product category in the last 12-month period, with both SMAs and unified managed accounts growing, according to data from Cerulli Associates.

“These new additions to our rapidly growing SMA and UMA solutions reinforce SEI’s ongoing commitment to enhancing the adviser experience with solutions that align with the complexities of modern wealth management,” Erich Holland, SEI’s executive managing director and head of adviser strategy and experience, said in a statement.

AssetMark Adds TIFIN AI Capabilities for Advisers

Wealth management solutions provider AssetMark Inc. has expanded its relationship with TIFIN Sage, an artificial intelligence-powered investment platform, to incorporate TIFIN’s AI solutions into AssetMark’s investment consulting services.

The expanded relationship aims to help investment consultants rapidly gather insights, align advisory firm inputs and deliver personalized model portfolios with greater efficiency.

“TIFIN Sage’s AI technology helps us empower more advisor practices and drive client outcomes in a rapidly evolving wealth management landscape,” David McNatt, an executive vice president of investment solutions at AssetMark, said in a statement.

AllianceBernstein Offering Direct Index Investment Product

AllianceBernstein L.P. has launched the AB Tax Advantaged Balanced Direct Index portfolio, which combines equities and municipal bonds into a separately managed account.

The solution is designed to customize client tax situations and risk preferences for investors. That includes automated tax loss harvesting across stocks and bonds in addition to AB Intelligent Rebalancing, which seeks to reduce tax costs associated with rebalancing.

The firm also launched the AB Tax Advantaged Equity Direct Index and the AB Tax Advantaged Strategic Research Balanced with Municipals, which are, respectively, equity-only direct indexing and tax-managed active multi-asset portfolios.

The firm’s portfolio management teams include Matthew Norton, Daryl Clements, Andrew Potter, Paul Robertson and John McLaughlin.

“We believe maximizing after-tax returns is critical for high-tax taxable investors,” AB’s head of separately managed accounts, Gavin Romm, said in a statement. “Through these solutions, we’re seeking to introduce the next generation of balanced investing with an innovative core portfolio and improved approach to rebalancing and systematic tax loss harvesting.”

Opinions November 21, 2024

3 Data-Driven Trends in Retirement Plan Management

Plan sponsors are interested in restructuring consultant relationships, expanding investment lineups, and enhancing participant education, writes Morgan Stanley's head of institutional consulting.

Reported by

As both retirement plans and financial markets grow more sophisticated, plan sponsors are facing mounting pressure to offer more comprehensive, strategic benefits packages. Amid these demands, our 2024 Morgan Stanley Retirement Plan Survey reveals that plan sponsors are increasingly seeking professional guidance to help them more effectively support their company goals and plan participants alike.

Findings indicate a sea change in focus, with plan sponsors keen on restructuring consultant relationships, expanding investment lineups, and enhancing participant education—underscoring the growing importance of professional expertise in delivering compelling retirement offerings. As the industry evolves and you consider your own path forward, these three central strategies may help make all the difference:

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

  1. Deepening consultant relationships

First, the relevance and demand for professional guidance is on the rise, with more than 80% of plan sponsors relying on consultants to navigate the complexities of the current financial markets—with no sign this trend is slowing down.

Moreover, the nature of these relationships is transforming, with indications of a shift in the structure of consultant arrangements toward higher-touch services. While 3(21) fiduciary relationships remain most popular among plan sponsors, there has been an uptick in interest in 3(38) engagements, where outsourced investment managers review investment options, make decisions, and take more fiduciary responsibility over the plan’s investment operations.

In fact, nearly half of plan sponsors say they are considering transitioning to a 3(38) investment manager. This transition is driven by various factors like a desire for reduced executive workload, maximum investment liability transfer under ERISA, and the ability of a 3(38) manager to take immediate action for fund changes.

This evolving trend is a clear indication of the growing demand for professional guidance in managing their plans—and signal that the industry must adapt to keep pace with this growing need.

  1. Expanding investment lineups

If working with a professional consultant is the first key ingredient for today’s plan sponsors, the second is expanding investment options—with more than a third planning to increase their offerings, though not necessarily the number of asset managers with whom they work.

The challenge here lies in the nuts and bolts of driving change within an investment lineup. Practically speaking, expanding fund choices can also increase the administrative burdens. No wonder roughly one in four plan sponsors said it’s somewhat difficult to change their investment lineup, citing their top challenges as communicating and educating plan participants on changes, handling regulatory filings, and covering the cost of moving assets. This speaks volumes about strategic opportunities for consultant guidance in helping plan sponsors more effectively manage this most foundational plan element—the investment lineup itself.

Along with these nuances, the data shows plan sponsors are leaning toward a different mix of offerings, with flexible investment options like target date funds with guaranteed payouts, multi-asset strategies, and hybrid default options rising in popularity. Providing choices and support for plan participants throughout their retirement lifecycle is a priority. For example, our recent Retirement Plan Survey also found that —clear evidence of an evolution in what both plan sponsors and participants are looking to do with their investments.

  1. Broadening participant education

Of course, the best laid retirement plans don’t mean anything until participants use them. Given the complexity of today’s retirement plans and the financial landscape we face as we age, an overwhelming majority of plan sponsors agree that educational materials and tools to engage participants are crucial.

To support the success of their retirement plans, 85% of sponsors provide online retirement planning tools, 74% provide online account review and analysis tools and 73% distribute written education content through their 401(k)s. Additionally, consultants and plan advisers are now the most common source for participant educational resources, with nearly half of plan sponsors turning to their consultants for these services. This trend is expected to continue as consultants increasingly incorporate participant education into their offerings.

Guidance as a differentiator

Taken together, these findings underscore an existential shift in the retirement plan industry, with the rising demand for professional guidance creating a new normal for plan sponsors. Deepening consultant relationships, diversified investment options, and targeted participant education all help equip retirement leaders to deliver practical solutions that respond more directly to employee needs.

Recognizing and adapting to these industry trends will ultimately be a significant factor in the ability of companies to maintain competitive benefits, foster employee engagement, and fulfill their fiduciary responsibilities. As the landscape continues to evolve, the reliance on expert guidance may become more than a trend—it may become a necessity.

Jeremy France is the head of institutional consulting solutions at Morgan Stanley.

This feature is to provide general information only, does not constitute legal or tax advice, and cannot be used or substituted for legal or tax advice. Any opinions of the author do not necessarily reflect the stance of ISS STOXX or its affiliates.

«