Survey of the Retirement Landscape

Challenges and Opportunities for Defined Contribution Specialists

What do sponsors want from DC specialists that service their plans? And how does that differ from DC specialists’ perception of what their clients are looking for? Voya Investment Management identifies unmet needs and emerging opportunities by exploring disconnects between the perceptions of plan sponsors and DC specialists.

Key Findings

• When it comes to retirement readiness, participants said they are much less prepared than both plan sponsors and DC specialists believe.

• Ensuring the plan’s regulatory compliance and that participants are appropriately invested are the two most important areas of short-term focus for both sponsors and specialists.

• Cybersecurity and reasonable plan fees were the top concerns of both sponsors and specialists.

• Sponsors said they value guidance from specialists on retirement income investment options and investment selection/monitoring more than any other services.

• As in previous editions of the survey, specialists again said they provide an array of services that plan sponsors do not acknowledge, pointing to a persistent communications problem.

• Specialists and sponsors agreed that annualized performance and historical rolling returns are the most important investment selection factors to consider, while deprioritizing other factors such as R-squared and Sortino ratio.

• Sponsors recognize that an aging participant base has brought focus on the growing need for retirement income products but cite cost and complexity as key challenges in offering these products.

• Since 2021, sponsors have increased their adoption of financial wellness programs and tools; top barriers to adding these programs include cost and difficulty in measuring outcomes.

• Sponsors and specialists underestimate the number of employees who act as caregivers, suggesting an opportunity to educate and support sponsors in these efforts.