Amid the first quarter’s market volatility, 401(k) participants who used professional advice to help with their 401(k) plan investing were more likely to sit tight than self-directed investors, research by Morningstar Inc. found.
According to Morningstar, 5.7% of participants enrolled in a 401(k) plan as of Dec. 31 changed their portfolio allocations during the first quarter, although the rate of change varied significantly based on how the participant was invested. Only about 2% of participants in target-date funds and managed accounts changed their portfolios, while more than 10% of participants who self-direct their portfolios made changes.
Participants in professionally managed portfolio options who made a change to their portfolio tended to be older, with longer plan tenures, higher deferral rates, higher salaries, higher balances and more conservative equity allocations. Participants self-directing their accounts who made a change tended to be younger, with lower salaries and lower balances.
Participants closest to retirement made the greatest changes to their portfolios, and they tended to significantly reduce their equity allocation.
The percentage of participants who selected the default investment declined throughout the first quarter, primarily among older participants, Morningstar said in a release.
President meets with ‘highly overrated globalist’ at the White House.
A new proposal could end the ban on promoting client reviews in states like California and Connecticut, giving state-registered advisors a level playing field with their SEC-registered peers.
Morningstar research data show improved retirement trajectories for self-directors and allocators placed in managed accounts.
Some in the industry say that more UBS financial advisors this year will be heading for the exits.
The Wall Street giant has blasted data middlemen as digital freeloaders, but tech firms and consumer advocates are pushing back.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
