Navigating Changing Dynamics in Retirement Plan Advisory Deals

The rapid growth in retirement plan advisory deals, driven by various factors, may be facing a slowdown, with older and larger firms reconsidering sales.  However, the evolving landscape suggests a potential shift towards the convergence of wealth, retirement, and workplace benefits, which could bring in new dynamics and attract different buyers.

The surge in retirement plan advisory deals, reaching an annual peak of 70, was driven by factors like willing buyers, sellers with capital, and key players such as Hub and OneDigital.  However, older and larger retirement plan advisory (RPA) firms, initially hesitant to sell, might now resist due to unmet promises from previous deals.  The M&A market could slow down with some aggregators pausing purchases and rising borrowing costs.  Yet, a potential shift toward converging wealth, retirement, and workplace benefits might attract new buyers, and RPAs excelling in cross-selling could remain appealing for capital infusion in this evolving market.

While the traditional RPA M&A market may face a slowdown, a potential move towards converging wealth, retirement, and workplace benefits could introduce new dynamics.  RPAs adept at cross-selling may continue to attract capital for acquisitions, especially as they transition into Phase 3 of the consolidation curve.  Despite evolving market conditions and a potential slowdown, the strategic convergence of financial domains in the workplace could still captivate new buyers and reshape the course of retirement advisory M&A.

To delve deeper into this topic, read Fred Barstein’s article on titled, “Is the Party Over for the RPA M&A Market?”


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