Facing fierce competition and pressure on fees for both current and new clients, providers are pivoting to focus on plan sponsors’ growing interest in financial wellbeing.
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For the past decade, the retirement plan industry has felt the pressure to reduce fees. This has spawned from increased scrutiny from plan sponsors, consultants, and ERISA attorneys as a result of litigation and greater transparency. Recordkeeping and administrative fees have continued to decrease as they are often viewed as a commodity, and for many of the top providers, simply table stakes to earning an employer’s business. Additionally, plan sponsors and their consultants continue to push for open architecture investment platforms that have removed the recordkeeper’s proprietary investment products, an additional revenue stream in the past. These forces have led to pressure on revenue, increased caseloads for service teams, and provider consolidation. 

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