We believe the time is now
January 23, 2023
Technological improvements have helped transform the retirement industry, allowing more participants access to a personalized investment service at a lower cost.1 We believe the evolution of recordkeepers’ data gathering capabilities, which can be leveraged to deliver a level of service once reserved for wealth management clients, represents a significant advancement in the retirement investment industry. Participants who use a managed account have a personalized portfolio created and monitored by investment professionals.
Compelling reasons to consider managed accounts:
Pathway to better retirement outcomes
We believe that a personalized approach to retirement investing is important and can guide participants to better retirement outcomes.2
Integration with recordkeepers
To provide a personalized allocation, there must be an integration between the recordkeeper and managed account provider. We believe technological improvements have broadened the options for connectivity between industry partners.
Participant engagement not required
Managed account providers can construct personalized participant allocations using data received from the recordkeeper and plan sponsor. Participants do not need to log into their account and provide additional data unless they want to.1
According to Cerulli Associates, managed account program fees have generally declined over the last few years.1
Why employers offer managed accounts
More than ever before, we believe workers are interested in help preparing for their retirement. Many may not have the expertise selecting investments and creating an asset allocation based on their personal situation and retirement goals. We believe employers are recognizing the challenges employees face preparing for retirement, which is why employers may offer a managed account service. As managed account adoption continues to increase,3 more employers are offering a personalized investment service that can guide participants to better retirement outcomes.2
Employers who offer a managed account as part of their employee benefits package have various reasons for doing so:5
-“We believe in giving participants the opportunity to have their funds professionally managed within the plan.”
-“For those that do not want to worry about their 401(k) plan this is a good option.”
-“Good option for people who might be late to the game of retirement savings…”
-“It’s great for those with little investment savvy or experience and/or those who just want some one else to manage their account holdings…”
Stadion’s managed account service: StoryLine
StoryLine is an investment management service designed to improve retirement outcomes through personalization. Stadion uses multiple data points from the recordkeeper to create personalized participant allocations. Participants can further customize through engagement.
For plan sponsors
-Enhances the plan sponsors benefit package by offering participants professional account management
-No cost to the plan sponsor
-Fiduciary protection when offered as a QDIA
For plan participants
-Personalized retirement portfolio
-Investment decisions based on a disciplined process, not emotions
-Simple enrollment process and ongoing support
Contact your Stadion representative to learn why now may be the time to consider managed accounts.
Contact your Stadion representative at 800.222.7636
Email us at firstname.lastname@example.org
For a full-color download of this presentation please click here.
1. Cerulli Associates, The Retirement Edge U.S. Retirement Edition 1Q 2021, Issue #58. “Similar to other investment solutions within the DC market, managed account program fees have generally declined over the years, but fee structures may differ from one provider to the next. Further, providers may offer lower fees to plan sponsors that use the managed account as the plan’s QDIA, as opposed to an ‘opt-in’ solution.”
2. Alight, “Managed accounts: A personalized employee benefit for retirement and financial wellbeing”, 2022.
3. Alight 2019 Trends & Experience in Defined Contribution Plans for years 2005 (6% managed account adoption), 2009 (26% managed account adoption), 2013 (52% managed account adoption) and 2017 (58% managed account adoption). The report is based on the responses from 240 plan sponsors that employ nearly 8.5 million workers. Alight 2021 Trends & Experience in Defined Contribution Plans for 2021 (62% managed account adoption). The report is based on responses from 263 plan sponsors with 77% employing at least 1,000 people.
4. The 2022 BlackRock Read on Retirement. The study included 305 plan sponsors, 1,308 workplace savers, 1,300 independent savers, and 300 retirees.
5. Plan Sponsor Council of America, Question of the Week “QOTW”. https://www.psca.org/news/qotw-managed-accounts.
None of the employers who provided responses were referencing Stadion’s managed account service.
There is no guarantee of the future performance of any Stadion account. Material has been derived from sources considered to be reliable, but the accuracy and completeness cannot be guaranteed. Stadion Money Management, LLC (“Stadion”) is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about Stadion’s investment advisory services can be found in its Form ADV Part 2, which is available upon request.
©2023 Stadion Money Management, LLC. All rights reserved. Stadion and the Stadion S are registered service marks of Stadion Money Management, LLC. StoryLine is a service mark of Stadion Money Management, LLC.