Retirement Plans

IRA Assets Reach Nearly $14 Trillion

Asset growth can be attributed to rollovers from defined contribution plans

This annual report represents Cerulli’s broadest coverage and most comprehensive sizing of the U.S. retirement market and addresses the following retirement segments: individual retirement accounts (IRAs), corporate and not-for-profit (NFP)/governmental defined contribution (DC) plans, and corporate and public defined benefit (DB) plans. The report also highlights results from Cerulli’s annual DC recordkeeper and 401(k) plan sponsor surveys. Access the report here.

January 23, 2023, BOSTON—Private bank and bank trust executives are actively implementing inorganic growth strategies, namely mergers and acquisitions (M&A) and advisor recruitment, to achieve scale in an increasingly competitive wealth management environment.

Firms that can offer a wide range of services (i.e., planning, trust, banking) and a strong advisor platform will be able to compete more efficiently to serve their clients’ needs, according to The Cerulli Report—U.S. Retirement Markets 2022: The Role of Workplace Retirement Plans in the War for Talent.

Much of the asset growth in the IRA market can be attributed to rollovers from defined contribution (DC) plans; rollovers accounted for $2.9 trillion in IRA asset growth between 2016 and 2021. “The exceptional capital market performance experienced during this five-year period translated to higher average 401(k) account balances and—for many higher balance participants nearing retirement—higher rollover balances as well,” says Shawn O’Brien, associate director.

Conversely, the sharp market downturn in 2022 should place downward pressure on IRA rollover balances in 2023, resulting in slightly higher net flows into corporate DC plans. “Furthermore, the auto-enrollment and auto-escalation provisions within SECURE 2.0 and ongoing legislative and market efforts to expand workplace retirement plan coverage may facilitate stronger contribution growth in the years ahead,” concludes O’Brien.

 

 

 

About Cerulli Associates
For over 30 years, Cerulli has provided global asset and wealth management firms with unmatched, actionable insights.
Headquartered in Boston with fully staffed offices in London and Singapore, Cerulli Associates is a global 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.

 

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