Cogent Reports: $382 Billion in Play in the 2015 Rollover IRA Market

CAMBRIDGE, Mass.--()--One in two (51%) affluent investors with a balance in a former employer-sponsored retirement plan (ESRP) expects to move their money into a rollover IRA in the next 12 months, representing the potential for $382 billion* to transfer into IRAs this year. Providers vying to capture these assets in flux would be well served to target Gen X and Gen Y investors, who are the most amenable to taking action. These and other findings are included in the 2014 annual Investor Rollover Assets in Motion™ study from Cogent Reports™, a division of Market Strategies International.

According to the report, Gen X and Gen Y investors with at least $100,000 in investable assets hold the largest proportion of their assets in former ESRPs and cite the highest likelihood of moving those assets into a Rollover IRA in the near future.

“As a result of early-career exploration and job switching, younger investors have accrued a sizeable balance in former retirement plans. The younger the investor, the more receptive and ready they are in terms of taking action,” says Sonia Sharigian, senior product manager at Market Strategies International and author of the report. “In fact, 61% of Gen X investors and 74% of Gen Y investors with former ESRPs intend to roll funds into a Rollover IRA within the next year.”

In addition, Cogent Reports identified the distributor firms best positioned to capture rollover assets from investors who own a former retirement plan. Vanguard, Charles Schwab and Fidelity Investments are the top preferred Rollover IRA providers with the greatest potential to attract and retain these sidelined assets.

“These leading providers have established themselves for offering low fees and expenses and have strong brand reputations, key factors Gen X and Gen Y investors cite when selecting a Rollover IRA destination,” adds Sharigian. “Softer, more personal outreach is also influential among these younger investors, who also consider providers they have established relations with—especially firms that make them feel like a valued customer.”

* This calculation is higher than in previous years due to an increase in the number of households with at least $100K in investable assets.

Top 10 Preferred Rollover IRA Destinations

1. Vanguard

2. Charles Schwab

3. Fidelity Investments

4. Edward Jones

5. Ameriprise

6. E*TRADE

7. USAA

8. Merrill Lynch

9. Wells Fargo Advisors

10. T. Rowe Price

Base: Investors who own a former retirement plan

Source: Market Strategies International. Cogent Reports™. Investor Rollover Assets in Motion™, December 2014.

About the Investor Rollover Assets in Motion Report

The Investor Rollover Assets in Motion report drills down into the assets investors hold in current and former employer-sponsored retirement plans (ESRPs) to help firms maximize their opportunity to gain IRA rollover assets. The report provides sizing for the Rollover IRA market, profiles investors most likely to roll over their plan assets, identifies the financial services firms best positioned to capture rollover assets and analyzes the specific steps investors have taken to prepare for retirement. Target quotas and weighting were set for key demographic variables to closely align with updated incidence and profile of US households with at least $100K in assets according to a Cogent Report’s independent study and the 2010 Survey of Consumer Finances (SCF) conducted by the Federal Reserve Board. Market Strategies will supply the exact wording of any survey questions upon request.

About Market Strategies International

Market Strategies International is a market research consultancy with deep expertise in consumer/retail, energy, financial services, healthcare, technology and telecommunications. The firm is ISO 20252 certified, reflecting its commitment to providing intelligent research, designed to the highest levels of accuracy, with meaningful results that help companies make confident business decisions.

Market Strategies conducts qualitative and quantitative research in 75 countries, and its specialties include brand, communications, CX, product development, segmentation and syndicated. Its syndicated products, known as Cogent Reports, help clients understand the market environment, explore industry trends and monitor their brand and products within the competitive landscape. Founded in 1989, Market Strategies is one of the largest market research firms in the world, with offices in the US, Canada and China. Read Market Strategies’ blog at FreshMR, and follow us on Facebook, Twitter and LinkedIn.

Contacts

Market Strategies International
Anne Fallon, 617.715.7611
anne.fallon@marketstrategies.com

Contacts

Market Strategies International
Anne Fallon, 617.715.7611
anne.fallon@marketstrategies.com