What's Happening?
Research by LIMRA indicates that advisors are cautiously optimistic about pooled employer plans (PEPs), which are seen as a way to reduce costs for employer clients. However, there is concern about the reduction in employer control over these plans. The
study categorizes advisors into three groups based on their familiarity with PEPs: occasional, hybrid, and specialist advisors. While specialists are more familiar with PEPs, occasional advisors, who often work with small businesses, are less so. Advisors express a desire for more education and tools to better understand and implement PEPs, primarily looking to pooled plan providers for this support.
Why It's Important?
The interest in PEPs highlights a shift in the retirement planning landscape, offering potential cost savings for employers. However, the reduction in control could deter some businesses from adopting these plans. The need for education and support suggests that financial institutions and plan providers have an opportunity to engage with advisors and clients to facilitate the adoption of PEPs. This development could lead to increased competition among financial service providers to offer comprehensive solutions and support, ultimately benefiting employers and employees through more efficient retirement planning options.
