The large share of U.S. consumers who have an individual retirement account but have balances that make retaining the services of an advisor unrealistic are the focus of a new solution.
Morningstar Investment Management and Envestnet plan to launch a managed accounts service that will provide personalized advice for IRA holders, whatever their balance. It will bring together Morningstar Retirement’s managed accounts methodology with Envestnet’s fund selection and model portfolio-building capabilities.
The firms say that 40% of American households have an IRA but few retain an advisor because of small balances. But the new solution will provide them with the same Morningstar Retirement platform used by 2 million employer-sponsored retirement plan holders.
It will be packaged within an IRA serviced by IRALogix, which provides low-cost investments using institutional share classes rather than retail ones. Morningstar Investment Management’s platform will create blended portfolios uniquely aligned with the account holder’s profile and situation and manage the portfolio for them including adjustment when appropriate. There will be no minimum account balance.
"We believe the IRA space is ripe for innovation and personalization," said Brock Johnson, president of Morningstar Retirement. “With the help of Envestnet Workplace Solutions and IRALogix, we aim to advance access to personalized investment advice and institutionally priced investment options in the IRA space. Every account holder should have access to not only a professionally built investment portfolio, but also one highly configured to their specific needs and objectives."
The new service is expected to launch in the first quarter of 2024 and will be custodied by Matrix, a subsidiary of Broadridge Inc.
"This service is a very powerful collaboration that we believe will give asset managers, broker-dealers, record keepers, and advisors options to shift the growing cost of administering their IRA programs to a private-labeled offering, while still retaining their existing revenue streams," said Sean Murray, head of workplace solutions at Envestnet. "It is a win for investors. It is a win for asset managers. And it is a win for the wealth and retirement industry."
No investor losses? The SEC can still claw back every dollar of pro
Plus, Well Fargo hails May recruitment haul totaling more than $3 billion in assets, while UBS recruits a top advisor and women's champion from Lazard.
Robinhood’s invite-only Concierge unit now serves about 60,000 affluent customers with CFP access, tax planning, and estate planning resources as the retail brokerage expands further into wealth management.
The two wealthtech platforms name new C-level executives as AI-native strategy and private markets growth accelerate across the advice industry
Franklin Resources' fixed-income unit settles SEC charges and closes firm-level DOJ and regulatory probes, but Kenneth Leech's criminal case continues.
As $84 trillion prepares to change hands, advisors who treat estate planning as peripheral are quietly building a sieve, not a book.
In volatile markets, the advisors who win aren't the ones with the best calls - they're the ones whose clients stay the course.
