Fidelity Survey: Most Plan Sponsors Remain Highly Satisfied with Their Plan Advisors, but about One-Third May Be at Risk

- Plan Design Changes Continue to Increase, with Adding Auto-Enrollment Being Most Popular

- Sponsors’ Increasing Focus on Healthcare Reducing Time Devoted to Retirement Benefits

- Providing Expertise on Income Replacement and Savings Rates May Help Advisors Win Business

BOSTON--()--Fidelity Investments® today announced the results of its eighth annual Plan Sponsor Attitudes survey, which revealed that the large majority of plan sponsors (65 percent) are highly satisfied with their plan advisors. However, a record number of plan sponsors are actively looking to switch their plan advisors (38 percent, up from 30 percent last year). The study, which began in 2008, surveyed employers who offer retirement plans that use a wide variety of recordkeepers and have at least 25 participants and $10 million in plan assets.1

“This is not a time for plan advisors to rest on their laurels. While most plan sponsors remain satisfied with their advisors, they are raising their expectations,” said Jordan Burgess, head of specialist field sales overseeing defined contribution investment only (DCIO) sales at Fidelity Institutional Asset Management®. “For some advisors, this could put their business at risk. For others, this could be an opportunity to win new clients.”

“Successful plan advisors are those who are aware of their dual mandate: to help plan participants achieve their retirement outcomes, as well as to support plan sponsors with the challenges associated with offering a defined contribution plan and other employee benefits,” added Burgess.

Reducing business costs related to having a plan is the top concern for plan sponsors, with 31 percent citing it as an area of focus. Other important themes for plan sponsors include managing their fiduciary responsibility (23 percent), preparing employees for retirement (22 percent) and the risk of litigation and liability (18 percent).

The research also highlighted the competing priorities and challenges employers face when allocating time, budget and resources to providing benefits to their employees. In terms of overall benefits, the plan sponsors surveyed report that health care ranks No. 1, before retirement benefits in order of importance. Two-thirds of the plan sponsors surveyed (67 percent) agree that increased health care costs have resulted in reduced spending on other benefits, an increase from 64 percent in 2016 and 60 percent in 2015.

Plan Sponsors Active in Making Changes
The study found that plan sponsors are making more plan design changes than ever before. Plan design activity continues to increase and reached a new high at 92 percent, with plan advisors seen as the primary influencer of these changes. Importantly, 79 percent of plan sponsors reported that participants were satisfied with the changes.

Auto-enrollment, which can improve participation rates from an average of 50 percent to 86 percent2, continues to be the most popular change, with 42 percent of the plan sponsors surveyed having introduced the feature in the past two years. More than two-thirds of the respondents (68 percent) said their participants were satisfied with auto-enrollment.

Delivering Value by Sharing Retirement Expertise
As the number of plan sponsors searching for new advisors hits a record high, plan advisors can strive to differentiate themselves from the competition by educating sponsors and participants on income replacement goals and helping improve savings rates:

  • Income Replacement: The study found that the majority of plans (71 percent) have an income replacement goal. However, while Fidelity suggests that plans should aim for a 45 percent income replacement rate in retirement years, only 25 percent of sponsors identified an income replacement goal between 25 and 50 percent. This underscores a need for advisors to help set goals for retirement income based on these best practices.
  • Savings Rates: The study revealed that 59 percent of plan sponsors believe their default deferral rate plus company match will provide sufficient savings for participants to retire. Yet, eight in 10 plan sponsors said they have employees who would delay retirement due to a lack of savings, exacerbated by increasing medical costs in retirement – estimated at $275,000 per couple.3 Additionally, about six in 10 said that a quarter or more of their workers leave the workforce early due to reasons beyond their control. Given these considerations, advisors could help sponsors consider the impact early or late retirement can have on their business and identify tactics to improve plan participant savings rates.

Additional information on the survey as well as resources and tools – including fund analytics and details on investment options – can be found at

Fidelity Institutional Asset Management®, Defined Contribution Investment Only (DCIO)
Fidelity Institutional Asset Management® is a leading provider of investment management and retirement services to defined contribution professionals nationwide, supporting advisors, recordkeepers, third-party administrators and plan sponsors in a collective effort to help participants achieve better retirement outcomes. As a retirement leader, Fidelity has deep knowledge of plans and participant behaviors. The firm combines this knowledge with a legacy of asset management —62 percent of Fidelity’s $2.3 trillion in managed assets are retirement assets as of June 2017— to become a key manager in the investment-only arena with about $77.5 billion in total DCIO assets.

Plan Sponsor Attitudes Survey: Methodology
The 2017 Plan Sponsor Attitudes Survey was conducted in collaboration with the eRewards panel from Research Now, an independent market research company, which conducted an online survey of 1,106 plan sponsors on behalf of Fidelity during February and March 2017. Respondents were identified as the primary person responsible for managing their organization’s 401(k) plan (with at least 25 participants and $10 million in plan assets), and the survey focused on those plan sponsors (890, or approximately 80%) using the services of a financial advisor or plan consultant. Fidelity Investments was not identified as the survey sponsor. The experiences of the plan sponsors who responded to the survey may not be representative of those other plan sponsors who use the services of an advisor. Previous Fidelity surveys were conducted in 2008, 2010, 2012, 2013, 2014, 2015 and 2016.

About Fidelity Investments
Fidelity’s mission is to inspire better futures and deliver better outcomes for the customers and businesses we serve. With assets under administration of $6.3 trillion, including managed assets of $2.3 trillion as of July 31, 2017, we focus on meeting the unique needs of a diverse set of customers: helping more than 26 million people invest their own life savings, 23,000 businesses manage employee benefit programs, as well as providing more than 12,500 financial advisory firms with investment and technology solutions to invest their own clients’ money. Privately held for 70 years, Fidelity employs more than 40,000 associates who are focused on the long-term success of our customers. For more information about Fidelity Investments, visit

The information contained herein is general in nature, is provided for informational purposes only and is not legal advice. Unless otherwise disclosed to you, any investment or management recommendation in this document is not meant to be impartial investment advice or advice in a fiduciary capacity, is intended to be educational and is not tailored to the investment needs of any specific individual. Fidelity and its representatives have a financial interest in any investment alternatives or transactions described in this document. Fidelity receives compensation from Fidelity funds and products, certain third-party funds and products, and certain investment services. The compensation that is received, either directly or indirectly, by Fidelity may vary based on such funds, products and services, which can create a conflict of interest for Fidelity and its representatives. Fiduciaries are solely responsible for exercising independent judgment in evaluating any transaction(s) and are assumed to be capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies.

The third-party trademarks and service marks are the property of their respective owners. All other trademarks and service marks are the property of FMR LLC or an affiliated company.

Products and services provided through Fidelity Institutional Asset Management® (FIAM®) to investment professionals, plan sponsors and institutional investors by Fidelity Investments Institutional Services Company, Inc., 500 Salem Street, Smithfield, RI 02917.

Fidelity Clearing & Custody SolutionsSM provides clearing, custody, or other brokerage services through National Financial Services LLC or Fidelity Brokerage Services LLC, Members NYSE, SIPC. 200 Seaport Boulevard, Boston, MA 02210.


© 2017 FMR LLC. All rights reserved.

1 Data presented here is based on the full 2017 survey results. Other published or historical data may reflect different values based on the criteria used, such as plan asset level or participant count.
2 Building Futures, data as of December 31, 2016. Based on Fidelity analysis of 21,600 corporate defined contribution (DC) plans (including advisor-sold DC) and over 13.5 million participants as of December 31, 2016. Fidelity's recordkept database of DC plans excludes tax-exempt plans, nonqualified plans, and the FMR Co. plan.
3 Fidelity Retiree Health Care Costs Estimate. Estimate based on a hypothetical couple retiring in 2017, 65-years-old, with life expectancies that align with Society of Actuaries’ RP-2014 Healthy Annuitant rates with Mortality Improvements Scale MP-2016. Estimates are calculated for “average” retirees, but may be more or less depending on actual health status, area of residence, and longevity. Estimate is net of taxes. The Fidelity Retiree Health Care Costs Estimate assumes individuals do not have employer-provided retiree health care coverage, but do qualify for the federal government’s insurance program, Original Medicare. The calculation takes into account cost-sharing provisions (such as deductibles and coinsurance) associated with Medicare Part A and Part B (inpatient and outpatient medical insurance). It also considers Medicare Part D (prescription drug coverage) premiums and out-of-pocket costs, as well as certain services excluded by Original Medicare. The estimate does not include other health-related expenses, such as over-the-counter medications, most dental services and long-term care. Life expectancies based on research and analysis by Fidelity Investments Benefits Consulting group and data from the Society of Actuaries, 2014.


Fidelity Investments
Corporate Communications, 617-563-5800
Follow us on Twitter @FidelityNews
Don Lim, 401-292-6496

Release Summary

Fidelity 2017 study: Most plan sponsors highly satisfied with their plan advisors, but record numbers actively looking to switch advisors.


Fidelity Investments
Corporate Communications, 617-563-5800
Follow us on Twitter @FidelityNews
Don Lim, 401-292-6496