Morgan Stanley surveyed almost 200 investment decision-makers at 401(k) plan sponsors with at least $50 million in assets under management, including 56 from organizations with more than $1 billion. We asked about concerns with their retirement plan, their investment lineups, their participant engagement strategies, and more.
The survey was split into four main categories:
- Sponsor Attitudes and Plan Design
- Plan Investment Lineup
- Consultant Relationships
- Participant Engagement
Here are some key findings from the full survey, offering valuable insights for those managing or sponsoring retirement plans1:
Sponsor Attitudes and Plan Design
- Plan competitiveness is sponsors’ top concern, followed closely by employee education and fulfilling fiduciary responsibilities.
- 78% of sponsors look at utilization rate as a measure of plan success.
- 67% of plans leverage matching contributions in their plan design to meet employee enrollment goals.
Plan Investment Lineup
- Sponsors want more investment options, but not more managers with more than 1/3 of respondents seeking to increase the number of investment options for participants.
- 46% of respondents say it’s important to offer a retirement income solution within the investment lineup, 40% say it’s critical, but 65% agree that lack of participant understanding deters them from adding an option.
- Managed Accounts are widely used, with 64% of respondents saying they currently offer in their plan.
Consultant Relationships
- Leveraging a 3(38) investment fiduciary shows momentum.
- 59% of respondents say leveraging a 3(38) reduces work for executives.
Participant Education
- Sponsors look to their consultant or advisor as the leading source for employee education.
- There is room for improvement with employee resources with only 31% of respondents very satisfied with available tools and resources.
The findings of the 2024 Morgan Stanley Retirement Survey may carry significant implications for employers and retirement plan sponsors. The data suggests a critical need for increased education and communication regarding retirement planning. Employers are positioned uniquely to bridge the knowledge gap and empower employees with the tools and resources necessary to make informed retirement planning decisions.
Moreover, the demand for personalized retirement advice and sustainable investment options may present an opportunity for plan sponsors to differentiate their offerings and cater to the evolving preferences of the modern workforce. By incorporating these elements, employers can enhance the appeal of their retirement plans and support a more financially secure retirement for their employees.
