401(k) participant needs are now on the radar of institutional investment houses and recordkeeping firms. 401(k) participant needs have morphed into what appears to be the endgame in what used to be a stodgy institutional industry. Some providers are actively pursuing and leveraging 401(k) plan participants. Other providers are less aggressive, but are equally interested in 401(k) participant needs.
As institutional providers now have their eyes set on servicing 401(k) plan participants as individuals, the providers are struggling with the lack of scalability they face when working with 401k participants as individuals. Scalability becomes an issue when working with individuals.
Challenges arise when the institutional industry is forced to deliver personal service. Institutional retirement plan providers have not traditionally been focused on serving individual needs. Can legacy record-keeping platforms integrate with AI and the plethora of investment products which regularly come to market? Participant data and cybersecurity also fall into the category of “the unknown” for institutional teams. Who owns the participant data and how does a record keeper prepare for the cyber attack that has not even been designed at this point?
For answers to these and other pressing issues that may make an advisor think twice – or even three times – over where they forge allegiances, see this helpful article to retirement plan advisors.