Cogent Reports: More DC Assets Stay In-plan Despite Slipping Satisfaction

Thanks in part to an extended bull market, more 1st wave boomers and Gen Xers have chosen to keep their retirement assets in a former employers plan for at least five years, welcome news for plan providers looking to keep assets in-house. But with a significant decrease in overall satisfaction among former plan participants this year, plan providers must take heed that investment performance is not the only factor that retains client assets. These and other findings are from DC Participant Planscape, an annual Cogent Reports„¢ study by Market Strategies International-Morpace.

Nearly half (46%) of former plan participants did not take any action with regard to rollover options in 2017 and almost as many (43%) intend to leave their assets in-plan this year. Participants report staying in-plan because they are content with the investment performance and choice of investment options and have no intention of moving their assets unless absolutely necessary.

Its tempting for plan providers to lean on market returns for help with participant satisfaction, said Julia Johnston-Ketterer, product director at Market Strategies-Morpace and author of the report. But the day will come when market action works against plan providers. Firms that demonstrate success in other key drivers of participant satisfaction•website and online capabilities and retirement planning tools•will be better equipped to weather future market volatility.

According to the report, the firms earning the highest level of former participant satisfaction, and thus those best positioned to retain assets in-plan, are:


Plan Provider

2Fidelity Investments
4Charles Schwab
6T. Rowe Price
7Merrill Lynch/Merrill Edge
8Prudential Retirement
9Nationwide Financial
10MassMutual Retirement

Base: DC participants in plans with former employers Source: Market Strategies International. Cogent Reports„¢. DC Participant Planscape. July 2018.

The secret to success for plan providers is to find the right balance between maintaining high satisfaction with former participants who decide to leave their assets in the plan while at the same time being ready to cross-sell with rollover IRAs and other investment servicers, added Linda York, senior vice president at Market Strategies-Morpace. Continuing and deepening the relationship•whether it is with a former plan participant or a rollover IRA investor•is key.

About DC Participant Planscape

Cogent Reports conducted an online survey of a representative cross section of 4,986 DC plan participants from April 30 to May 18, 2018. Survey participants were required to be 18 years or older, and contribute at least 1% to a current plan and/or have $5,000 or more in at least one former plan. Cogent Reports uses market-sizing incidence survey findings, which are weighted to US census data, to develop quota targets followed during fieldwork and apply minimal statistical weighting post-fielding. The data have a margin of error of ±1.39% at the 95% confidence level. Market Strategies International-Morpace will supply the exact wording of any survey question upon request.

About Market Strategies International-Morpace

Leading market research firms Market Strategies International and Morpace bring clients closer to their customers through exceptional insights, which includes deep expertise in financial services, specifically among wealth, banking, payments and insurance organizations. The firms specialize in brand, customer experience, product development and segmentation research, and are known for blending primary research with data from syndicated, benchmarking and self-funded studies to help clients succeed. The syndicated products, known as Cogent Reports, help clients understand the market environment, explore industry trends and monitor their brand within the competitive landscape. Market Strategies and Morpace have earned the trust of many of the worlds top brands across the automotive, consumer & retail, energy, financial services, health, technology and telecommunications industries. They are combining into one firm, as part of an acquisition of both firms by STG, and will be rebranded under a new name to be announced later in 2018. With more than 450 research professionals, the collective firm is now the 15th largest market research firm in the US and top 25 globally.