Capital Group extends retirement plan services further with a focus on advisors

Capital Group is deepening its focus on the small- and mid-sized retirement plan market with a slate of updates to its RecordkeeperDirect platform, aiming to make it easier for advisors to win new plan business and streamline plan management for sponsors.

On Monday, the asset management and recordkeeping giant announced a slate of new enhancements include expanded fund flexibility, new digital onboarding features, and the rollout of a semi-bundled solution called RecordkeeperDirect Integrated.

According to the firm, the updates reflect growing demand among advisors for scalable platforms that simplify the administration of retirement plans while offering more options to meet client needs.

"Capital Group is committed to helping Americans retire with confidence," Ross McDonald, national sales director for retirement plans at Capital Group, said in a Monday release. "That's at the core of why we build solutions that make retirement plans easier to implement, manage and grow – including solutions specifically for small businesses."

The company’s RecordkeeperDirect platform, designed for smaller employers and startups, now includes the option to incorporate third-party fund families alongside Capital Group’s American Funds and target date retirement series.

The platform also features electronic loan management, a digital onboarding portal, and access to Capital Group’s ICanRetire tool, which offers personalized education and savings support for plan participants and can help address the advice gap among 401(k) plan members.

Capital Group also revealed an integrated version of RecordkeeperDirect, which it originally provided exclusively to a large client with more than 20,000 advisors. That solution, which it's now rolling out to the broader market, includes bundled features such as investment menus, participant education, and simplified onboarding to reduce friction for advisors managing multiple plans.

Capital Group said it serves nearly 10 percent of small- and mid-sized plans in the US, and has steadily built out its retirement plan service infrastructure in recent years.

In an email to InvestmentNews, McDonald said the firm is seeing increased momentum among advisors, including RIAs, working with business owners to either launch retirement plans or make improvements to the ones they have in place

"As more employers enter the retirement space, there’s a growing need for streamlined, flexible solutions that deliver institutional-quality service without unnecessary complexity," he said.

Among other developments, McDonald cited a "consolidation of partnerships," with advisors becoming choosier about the number of partners they work with to scale their retirement plan and wealth businesses.

"Retirement plan advisors are increasingly embracing semi-bundled solutions that streamline plan setup and maintenance," McDonald said. "They’re looking for simplicity, quality, and a seamless experience – for themselves and their clients."

Capital Group's recordkeeping updates come just after it debuted three new active ETFs – including its first focused US growth and large value strategies – bringing its total ETF assets to $66 billion. Roughly 20 percent of its ETF flows now come from RIAs, the firm said. The firm said its latest ETFs are designed for advisors building model portfolios for their clients.

In line with that, McDonald says the firm is paying close attention to a growing trend toward "mass customization" as a priority for advisors with an interest in the retirement plan space.

"Advisors want scalable solutions with tailored features such as flexible pricing models and customizable fund menus," he said. "This allows them to maintain consistency in their offering while still meeting the unique needs of each client."