Fee Levelization — Advisor Insights Study

Research Findings — July 2017

There’s a lot of buzz around equalizing or levelizing retirement plan administrative fees.

But how are advisors using fee levelization? What are their biggest challenges when it comes to speaking to plan sponsors? And how often are advisors talking about fee levelization with clients? We wanted to better understand these trends, so we asked. Here are a few key findings.

1) New clients hear more about fee levelization

Advisors seem more likely to talk about levelizing plan administrative fees with prospective clients than current clients. But for some the conversation isn’t taking place at all.
54% of advisors say they're regularly pitching fee levelization to prospects

About half of advisors...

Say they're regularly pitching fee levelization to prospects.
37% of advisors tell us they're talking with current clients at least once a year about fee levelization

But only a little over a third...

Tell us they're talking with current clients at least once a year about fee levelization.
2 in 5 advisors aren't talking about fee levelization with potential clients & 1 in 4 advisors aren't talking to current clients at all about fee levelization

2 in 5 (46%)

Aren't talking about it with potential clients.

1 in 4 (26%)

Aren't talking to current clients at all about fee levelization.

2) Fee levelization adoption is low, but growing

While the majority of advisors report a low percentage of clients currently using a method to level or equalize fees, they expect that number to change. A lot.

More than a third (40.7%) of advisors...

1 in 5 (23.3%)...

40% of advisors report less than a quarter of their current clients equalize participant fees
Report less than a quarter of their current clients equalize participant fees.
1 in 5 advisors expect more than half of their clients will make a change within the next year
Expect more than half of their clients will make a change within the next year.

3) Learn more

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Source: The Fee Levelization — Advisor Insights Study, July 2017

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