401(k) Growing Source of Advisor Income

July 24, 2001 (PLANSPONSOR.com) - Qualified retirement plans are a growing source of income for financial planners and third party administrators (TPAs) - particularly the top sellers, according to a new report.

The top 20% of advisors deriving more than 80% of their income from this source, according to a study by Brightwork Partners and Search401(k).

Monthly Metric

That report also found that the top 20% of advisors sold an average of nearly eight standard 401(k) plans in the past 12 months, while the “average” advisor sold just over four standard 401(k) cases during that period.

However, on average, advisors derive about 33% of their income from group retirement products.

The survey found that the average employer served by an advisor has just under 100 employees. However advisors affiliated with TPAs or benefits consultants serve groups averaging 230 employees, while those affiliated with a financial planning company serve employers who employ 34 workers on average.

The sample comprised 700 retirement services advisors who derive at least a portion of their professional income from the sale of group retirement products.