AXA US Study Quantifies the Value Advisors Bring to 403(b) Participants

Plan participants who use an advisor can benefit from the experience both financially and emotionally, according to a new study of 403(b) plan participants by AXA US, a leading financial protection company. A 403(b) plan is a tax-advantaged retirement plan used largely by teachers in U.S. public schools.

Those who used an advisor had a 34 percent higher median balance in their accounts than those who had the option to use an advisor, but did not do so, according to the study of more than 1,000 respondents which was synthesized this year. In addition, those using an advisor reported they were extremely or very satisfied with the performance of their 403(b) plans, by a margin of 75 percent to 56 percent, compared with those who had an advisor option, but didn’t use it.

“Teachers may not be able to depend on their pensions to fully maintain the lifestyles they enjoyed while working,” said Keith Namiot, Head of Product Development, AXA Employer Sponsored Markets. “Also, because plan and investment options have grown more complex, an advisor can add value by being able to help participants break retirement decisions down into small, manageable steps, such as contributing to a 403(b) plan early in their careers and increasing contributions over time.”

White Paper

The AXA US study, which produced the white paper “Enhancing Outcomes, The Value an Advisor Brings to K-12 Participant Preparedness and Account Performance in 403(b) Plans,” was commissioned in an attempt to quantify the value that an advisor brings to plan participants’ retirement goals. Respondents to the survey were drawn from 19 providers. Fewer than 9 percent of the respondents were AXA US clients.

Key Findings

• In other study findings, illustrated in this downloadable infographic, the data indicated that by 79 percent to 59 percent, those who use an advisor are much more confident about reaching their retirement goals.
• Respondents who worked with an advisor had 33 percent higher average monthly contribution levels.
• Regarding diversification, 65 percent of participants using an advisor invested in two or more funds, vs. 55 percent of those who had an advisor option, but chose not to use an advisor.
• Some two-thirds of respondents attributed earlier enrollment in retirement plans to advisor influence.
• Those using an advisor also tended to take a more active role: by 80 percent, those who used an advisor kept an eye on their account’s overall performance, vs. 70 percent of those who didn’t use an advisor.
• Participants also believed that an advisor helped them to set and stick to their retirement savings goals, by 86 percent over 67 percent.

More info:

Whitepaper: www.axa.com/news/403b-advisor-value/ssi/enhanced-outcomes-whitepaper.pdf

Infographic: www. axa.com/news/403b-advisor-value/ssi/advisor-value-infographic.pdf

Subject matter expert bios: www.axa.com/news/403b-advisor-value/index.html

AXA’s 403(b) Learning Lab: www.axa.com/teachers

About AXA

“AXA” is the brand name of AXA Equitable Financial Services, LLC and its family of companies (“AXA US”) including AXA Equitable Life Insurance Company (AXA Equitable). In business since 1859, AXA Equitable is a leading financial protection company and one of the nation’s premier providers of life insurance, annuity, and financial products and services. We provide retirement benefits and services to over 28,000 employer-sponsored plans in the employer-sponsored marketplace. AXA Equitable is a leader in the 457(b), 401(a), 403(b), and 401(k) employer-sponsored retirement planning marketplace and is the number-one provider of 403(b) retirement savings products to educators in the K-12 space.1 We are part of the global AXA Group (AXA S.A.)2, a worldwide leader in financial protection and wealth management with 103 million clients in 59 countries. In 2015, for the seventh year in a row, Interbrand ranked AXA as the #1 global insurance brand in its prestigious list of Best Global Brands.

Call (888) AXA-INFO (292-4636) and we'll help you take the next step toward your financial goals. Find AXA on Facebook, Twitter and LinkedIn. For more information, visit www.axa.com.

1 LIMRA Secure Retirement Institute, fourth quarter, 2013 Not-for-Profit Retirement Market Sales Survey.
2 AXA S.A. is a French holding company for a group of international insurance and financial services companies, including AXA Equitable Financial Services, LLC.

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