Retirement Insights

Advisor outlook for Read on Retirement®

September 17, 2024 | BlackRock Retirement Perspectives

A serene walkway adorned with trees and vibrant flowers, reflecting on an advisor outlook for retirement

Key points

  • 01

    Income is in the conversation

    The majority (81%) of retirement plan advisors are discussing retirement income with clients.

  • 02

    Advisors are in on active

    Over half (55%) believe active managers can consistently outperform the market.

  • 03

    Valuing participants is part of the strategy

    Over half (55%) mention they differentiate their practice through expertise in meeting participant needs and education.

About the survey

Retirement. It’s deeply personal. And nobody knows this better than the retirement plan advisors working first-hand with sponsors to understand and address the challenges their savers face.

That’s why we surveyed over 300 advisors as part of our annual Read on Retirement® research to better understand how they’re enhancing outcomes and growing their practice.

More resilient portfolios

We found that in this period of volatility and uncertainty, plan advisors are looking to help plan sponsors build more resilient portfolios. They’re focused on implementing active and income strategies, and streamlining their practice management, including incorporating AI-powered tools.

Carrie Schroen, Head of BlackRock’s U.S. Defined Contribution Intermediary Business said, “In these uncertain market conditions, plan advisors are looking for solutions that will help more Americans achieve better retirement outcomes. Our research demonstrates the importance of access to affordable solutions and education, areas that are vital to providers and participants alike.”

Leading the conversation on income

Plan advisors are rallying around retirement income as a solution to help their clients’ employees invest for the long-term. 81% report discussing retirement income with DC clients, but they also report there are some barriers, like communicating a clear benefit in terms of improved outcomes (44%) and providing clear participant education and communications (42%).

These barriers, though, could be an opportunity for plan advisors to add value: 59% mention their defined contribution clients reach out to them for providing participant education and communication on retirement income.

An eye toward active

Over half (55%) of plan advisors believe that active managers can consistently outperform the market and, when it comes to the value of active, they cited these benefits the most: access to more investments (59%), protection against loss (47%) and sector choices (44%).

Plan advisors aren’t just recommending active solutions on a whim, though. They are evaluating solutions, and when it comes to that they cited access to a cost-effective strategy as the most important factor (71%). They also ranked diversification (66%) and manager expertise (60%) as important factors.

Growing their practice

Plan advisors are taking an active approach to their own businesses, too, identifying how they can differentiate themselves from the pack. 55% say they do this through their expertise in meeting participant needs and education (including advice and retirement readiness). 48% are currently offering financial wellness plans for their clients, and 30% plan to add assistance with participant communications in the next year.

The data also shows that plans to use AI to streamline practice management are growing. While only 9% of plan advisors are currently using AI-powered tools, 53% report being likely to use them in the next 12 months.

Want more survey findings?

In our full release on Read on Retirement® we asked nearly 4,000 people to tell us how they’re feeling about retirement – the expectations, realities, concerns and challenges. The findings show that while everyone’s path to retirement is personal – the challenges they all face are shared.
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