advisor-driven retirement market: profiling the top retirement advisors

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  1. 1. Frank Polefrone Senior Vice President, Access Data, a Broadridge Company Advisor-Driven Retirement Market Profiling The Top Retirement Advisors November 5, 2013
  2. 2. 2 Advisor Driven Retirement Market The Data Challenge Independent Retirement Platforms Distributors Advisor Insights Agenda
  3. 3. Retirement Market Landscape
  4. 4. 4 Advisor-Driven Retirement Market Landscape DC Assets seeing highest growth rate Advisors driving plan growth Top 20 Independent Recordkeepers Wirehouse Independent B/Ds & RIAs Investment Only Fund Firms
  5. 5. 5 55% of $5.1 Trillion of DC is Advisor Driven Business
  6. 6. 6 Advisor Driven Retirement Assets = $2.8 Trillion
  7. 7. 7 Total Assets $2.8 Advisor Sold DC Plans 446K Advisor Sold DC Participants 49M Independents $1.6T $1.2T Schwab/Fidelity
  8. 8. 8 446K employers with 49M participants Primarily Transaction Oriented Employee Base The data challenge
  9. 9. 9 5K BDs with 500K RRs 14K RIAs
  10. 10. 10 The Data Challenge Complex distribution model Increased regulatory requirements Revenue sharing requirements Lack of transparency and market information Difficulty identifying and influencing retirement specialists
  11. 11. Advisor Driven Retirement Top Platforms
  12. 12. 12 Advisor Driven Retirement Platforms Source: Retirement Plan Sponsor Survey Supermarket & Fund Platforms 1.6 Trillion Rank Company Assets Plans 1 Fidelity 1,096,623 32,293 2 Prudential 199,488 5,145 3 Charles Schwab 109,363 1,164 4 Ascensus 41,973 41,338 5 ADP 40,473 35,384 6 American Funds 37,648 34,686 7 The Newport Grp. 23,422 2,261 8 CUNA Mutual/CPI 11,315 6,214 9 Daily Access 8,050 1,595 10 Aspire Financial 5,637 6,056 Insurance Platforms 1.1 Trillion Rank Company Assets Plans 1 ING 301,720 47,718 2 Great West 178,166 27,266 3 Principal 136,987 47,857 4 MassMutual 104,318 37,159 5 Transamerica 82,292 20,345 6 Nationwide 79,161 40,698 7 John Hancock 71,105 44,620 8 Lincoln 48,940 23,429 9 New York Life 32,595 1,650 10 OneAmerica 18,100 9,700
  13. 13. 13 DC Assets by Platform Type $425 $1,053 $1,206 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 Mutual Fund Platform Insurance Platforms Supermarket Fund Platforms DC Assets ($B) Source: Plan Sponsor Survey
  14. 14. 14 DC Plans by Platform Type 132,679 300,442 33,457 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 Mutual Fund Platform Insurance Platforms Supermarket Fund Platforms Number of Plans Source: Plan Sponsor Survey
  15. 15. 15 DC Participants by Platform Type 8.98 19.10 17.10 - 2 4 6 8 10 12 14 16 18 20 Mutual Fund Platform Insurance Platforms Supermarket Fund Platforms Number of Participants (M) Source: Plan Sponsor Survey
  16. 16. 16 Advisor Driven Retirement Platforms Source: Retirement Plan Sponsor Survey Small Plans Rank Company $1MM - $10MM % Share 1 Fidelity 49,349 9.2% 2 John Hancock 47,908 9.0% 3 Great West 40,202 7.5% 4 Principal 35,220 6.6% 5 ING 35,177 6.6% 6 MassMutual 33,911 6.3% 7 TIAA-CREF 23,430 4.4% 8 Nationwide 23,018 4.3% 9 Ascensus 22,016 4.1% 10 American Funds 20,838 3.9% Mid Plans Rank Company $10MM - $50MM % Share 1 Fidelity 85,480 15.5% 2 TIAA-CREF 48,143 8.7% 3 Great West 32,672 5.9% 4 Principal 32,110 5.8% 5 Wells Fargo 26,334 4.8% 6 ING 25,750 4.7% 7 Prudential 24,527 4.4% 8 MassMutual 23,969 4.3% 9 Vanguard 19,768 3.6% 10 Transamerica 19,032 3.4%
  17. 17. Distributors Selling DC Plans
  18. 18. 18 Proportion of 401(k) Producers 2012 52% Dont Sell 401(k) 48% Sell 401(k) 39% 31% 53% 62% 45% RIA Bank Independent Regional National BASE = All Advisors / = Significant change from 20111 t0 2012 Source: Cogent Research, Retirement Plan Advisor Brandscape 2012
  19. 19. 19 401(k) AUM by Producer Level 44% 25% 49% 52% 66% 42% 39% 52% 43% 33% 23% 33% 18% 23% 8% 15% 11% 25% 0% 20% 40% 60% 80% 100% Total National Regional Independent Bank RIA Light Moderate Heavy BASE = Advisors with 5%+ AUM in 401(K) Plans / = Significant change from 20111 t0 2012 Source: Cogent Research, Retirement Plan Advisor Brandscape 2012
  20. 20. 20 Market Distribution of Advisors * Source: Cogent Research, Retirement Plan Advisor Brandscape 2012 With 5% or more in 401(k) AUM* Independent 43% National 28% Regional 14% RIA 12% Bank 4%
  21. 21. 21 401(k) Asset Allocation: Bundled Vs. Unbundled 42% 34% 40% 46% 20% 61% 58% 66% 60% 54% 80% 39% 0% 20% 40% 60% 80% 100% Total National Regional Independent Bank RIA Unbundled Bundled BASE = Advisors with 5%+ AUM in 401(K) Plans Source: Cogent Research, Retirement Plan Advisor Brandscape 2012
  22. 22. 22 Distributors of Advisor Sold DC Plans 3,799 3,986 58,173 18,523 - 10,000 20,000 30,000 40,000 50,000 60,000 Banks and Trust Companies Registered Investment Advisors Advisors at Independent/ Regional BDs Advisors at Wirehouse/National Source: Access Data, a Broadridge Company
  23. 23. Advisors Selling DC Plans
  24. 24. 24 Advisors Selling DC Plans 85,486 67,358 18,128 - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 Total Advisors Selling DC Plans Advisors on One Platform Advisors on Multiple Platforms Source: Access Data, a Broadridge Company
  25. 25. 25 Dually Registered Advisors 50,031 40,501 9,530 - 10,000 20,000 30,000 40,000 50,000 60,000 Total Dually Registered Advisors Selling DC Plans Dually Registered Advisors - One Platform Dually Registered Advisors - Multiple Platforms Selling DC Plans Source: Access Data, a Broadridge Company
  26. 26. 26 Advisors Selling DC Plans 85% 92% 58% 15% 8% 42% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Total Advisors Selling DC Plans Advisors on One Platform Advisors on Multiple Platforms Insurance Platform Mutual Fund Platform Source: Access Data, a Broadridge Company
  27. 27. 27 Dully Registered Advisors 81% 90% 62% 19% 10% 38% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Total Dually Registered Advisors Selling DC Plans Dually Registered Advisors One Platform Dually Registered Advisors Multiple Platforms Insurance Platform Mutual Fund Platform Source: Access Data, a Broadridge Company
  28. 28. 28 Top Advisors by Number of Platforms 3.68 2.2 1.3 - 1 2 3 4 Heavy Users Moderate Users Total Advisors (Average Number) Source: Access Data, a Broadridge Company
  29. 29. 29 Retirement Specialists Number of Platforms 13,170 3,377 1,109 - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 Moderate Users Heavy Users Retirement Specialists Retirement Specialists Use 4+ Platforms Source: Access Data, a Broadridge Company
  30. 30. 30 Advisor Driven Business Expected to Grow $2.5 $2.8 $3.0 $3.2 $3.5 $3.7 $3.9 $4.1 $2.1 $2.3 $2.4 $2.5 $2.5 $2.6 $2.6 $2.6 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 $7.0 2011E 2012E 2013P 2014P 2015P 2016P 2017P 2018P DC Assets: Investment Only vs. Proprietary ($T) Investment Only Proprietary Source: Simfund Pro, 7.0 / Access Data, a Broadridge Company 55% 45% 62% 38%
  31. 31. 31 20+, 16% 10-19, 24% 5-9, 25% 1-4, 35% Currently Manage in 2012 Average Number of 401(k)s Managed per Year BASE = Advisors with 5%+ AUM in 401(K) Plans Source: Cogent Research, Retirement Plan Advisor Brandscape 2012 20+, 24% 10-19, 25% 5-9, 28% 1-4, 23% Anticipate in 2013
  32. 32. 32 Use data to segment and service Focus on retirement specialists Use data to identify best prospects Partner with distributors and access points Service small to medium plans Leverage multi-channel communications, engaging content and education to support advisors Strategies for Driving Growth Advisor Support Marketing Participant Comms
  33. 33. Wrap Up & Discussion

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