Investor Sentiment

Young Retirement Investors Are Eager For Advice

Retirement plan providers must offer reasonably priced solutions to meet unmet demand

Stay on top of the latest product, marketing, distribution, sales, platform, and regulatory trends in the U.S. retirement marketplace with a new report from Cerulli Associates. Access the full report here

September 26, 2023, BOSTON—Younger generations desire the advice of a financial professional at similar rates as their older counterparts, pointing to an unmet demand for plan providers to offer reasonably priced in-plan financial advice and planning solutions, according to the latest Cerulli Edge—U.S. Retirement Edition.

Interestingly, the desire to seek out a financial advisor does not vary significantly across generations. 68% of Generation Z plan participants say they would seek out a financial advisor before making a change to their finances, as would 69% of Baby Boomers. Yet, 70% of plan participants with less than $100,000 in investable assets—often where Generation Z falls—do not work with a financial advisor.

“The defined contribution (DC) market is fee-sensitive, and younger, lower-balance participants are unlikely to see a net benefit from being automatically enrolled into an expensive in-plan advice solution,” says Elizabeth Chiffer, analyst. “Retirement plan providers that seek to improve the financial well-being of their youngest investors, and potentially set the stage for future financial advice relationships with them, will need to build out cost-effective solutions to effectively address their financial challenges at scale.”

Cerulli recommends employers and retirement plan providers continue to pursue efforts to educate and, when called for, advise participants on their finances. Meanwhile, lower-cost solutions combined with effective communication and employee engagement campaigns can address the financial challenges most participants face while creating opportunities for providers to service assets across the lifetime of the participant.




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.