The retirement market is in the trillions, but banks will have to play catch-up to acquire a significant share of those dollars. According to a recent survey, only 14% of “mass affluent consumers” cited their banks as primary providers of retirement services, compared to 53% for investment and brokerage firms. And in the past year, just 18% of 401(k) rollovers were captured by banks compared to 67% for investment and brokerage firms.
The survey was conducted by BIA Research, a professional organization focused on enhancing employee and organizational performance, and Mercatus LLC, a financial services with strategy and investment firm. They surveyed 2,997 "mass affluent individuals"– those with investable assets between $50,000 and $2 million who are between 35 and 70 years old – to better understand how they prepare for retirement and to provide banks with insights to reestablish their footing in the retirement marketplace.
The study suggests that banks focus on three key opportunities:
- Capture 401(k) rollovers
- Capitalize on retirement asset consolidation
- Establish a retirement dialogue with customers
But it’s going to be a tremendous chanllenge. Banks have been focused on transactions instead of advisory services. Investment and brokerage firms have already figured out how to do that.
Here is a link to BAI’s press release about their study.
