Top-Down View

Leaders at three retirement plan recordkeepers discuss the state of the industry and issues that most influence plan sponsors and their participants

During a roundtable discussion at the recent PLANSPONSOR National Conference, David Musto, CEO of Retirement Plan Services at J.P. Morgan Asset Management, Joe Ready, executive vice president at Wells Fargo Institutional Retirements & Trust, and Elaine Sarsynski, executive vice president of MassMutual’s Retirement Services Division and chairman of MassMutual International LLC, shared their thoughts about what lies ahead for plan sponsors and plan participants with Alison Cooke Mintzer, editor-in-chief of PLANSPONSOR.

PS: What are the challenges facing the retirement plan industry today?

Musto: One is the fact that we as an industry seem to focus way too much on averages—average contribution and participation rate, average accumulated savings. It’s important to be more specific and more thoughtful in the way that we describe results, which leads to the second challenge: We don’t always have a consistent target for success as an industry, but income replacement rates are a good place to start.

Sarsynski: A major concern of most employers we work with is attracting, engaging and then retaining employees. How do we ensure that our employees are focused on their objectives? We know that engaged workers are critical to the success of the organization, so employee benefits in general are very important, and that goes from health to other welfare benefits as well.

Ready: The burden for retirement has fallen 100% on the individual, and it has to be more of a shared responsibility. Every data point we see says individuals know they own their own retirement, but they need help.    

The industry is under attack with critics saying that we failed. A lot of it has to do with our language around averages, but there’s a lot of proof that the system does work. The legislative and regulatory uncertainty creates a lot of noise, so people get paralyzed and unsure of how to react or where to move.