Benefits Planning

Asset Managers Should Rethink Their Approach To Advisors Servicing Defined Contribution Plans

Asset managers can position themselves as strategic partners for broker/dealer-based advisors seeking to bridge their retirement plan and wealth businesses

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February 21, 2024, BOSTON—As broker/dealers (B/Ds) actively encourage their advisors to lean into the retirement plan space, asset managers will need to adapt their approach to product distribution and advisor support in this evolving intermediary landscape, according to the latest Cerulli Edge—U.S. Asset and Wealth Management Edition.

Most top-tier asset managers have separate wholesaler teams dedicated to covering the defined contribution (DC) market, including B/D-based advisor practices that specialize in advising retirement plans. However, when it comes to “dabbler” and “nonproducer” retirement plan advisors the coverage areas between retail and DC wholesalers start to blur, adding a layer of logistical complexity to engaging and supporting these advisors.[1]

“‘Dabbler’ and ‘nonproducer’ retirement plan advisors make up the majority of B/D-based retirement plan advisors and a meaningful portion of B/D advisor-sold DC assets,” says Shawn O’Brien, director. “However, some asset managers say their firm still employs a siloed approach to covering these advisors, with little communication between retail and DCIO wholesaler teams.”

Close to half of dabblers and nonproducers (44%) say if they received greater support cultivating wealth management clients from their DC business, they would be more inclined to pursue DC plan opportunities. Cerulli recommends asset managers’ distribution teams employ a collaborative coverage model to address these advisors who express an interest in improving or growing the retirement plan side of their businesses.

Additionally, having better sales tools to grow their DC businesses is a keen area of interest among 41% of nonspecialist retirement plan advisors. “B/D-based advisors lean on asset managers for nonproduct-related tools, education, and strategic guidance that help them better serve their clients and grow their book of business,” says O’Brien. “By helping advisors improve and grow their practices, asset managers win advisors’ loyalty and trust, positioning themselves as strategic partners and laying the foundation for long-term, reciprocal relationships.”




[1] Dabblers are advisors for whom 15%-49% of their AUA is with retirement plans and nonproducers are advisors for whom less than 15% of their AUA comes from retirement plans.
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Headquartered in Boston, Cerulli Associates is an international research and consulting firm that provides financial institutions with guidance in strategic positioning and new business development. Our analysts blend industry knowledge, original research, and data analysis to bring perspective to current market conditions and forecasts for future developments.