PLANSPONSOR - February - March 2022 - 32

PARTICIPANTS SPECIAL ISSUE | INVESTMENTS
Managed Accounts, Today
The strategy has grown increasingly viable for use in DC plans
M
anaged accounts have evolved
since the Pension Protection
Act of 2006 approved them as
a qualified default investment alternative.
Over the years, fees have dropped and levels
of advice been added. As a result, plan
fiduciaries are taking notice.
" We've seen tremendous growth in
the use of managed accounts in plans over
the past few years, " says Amber Czonstka,
head of product advice and client experience
for Vanguard's institutional business
in New York City. " More than 70%
of participants in Vanguard-recordkept
plans have access to a managed account. "
Vanguard defines managed accounts
as fee-based advisory services that provide
participants with personalized recommendations,
advice and portfolio management
tailored to their unique needs. In a
nondiscretionary managed account, the
investment adviser requires participant
permission before making transactions.
32 PLANSPONSOR.COM February - March 2022
In a discretionary managed account, the
participant allows the adviser to transact
on her behalf.
Vanguard's 70% with managed
account access includes plan participants
using either Vanguard's Managed Account
Program, a 3(38) service; Digital Advisor,
in which Vanguard serves as a 3(38) discretionary
manager; or Personal Advisor
Services, which provides ongoing nondiscretionary
managed account services.
The reasons for the greater interest,
says Czonstka, are " price and accessibility,
and the robustness we're able to bring
when it comes to advice. Advice is no
longer just portfolio management, but it's
a range of financial planning solutions, to
help people think through debt management
strategies, save for an emergency
fund and think of how to draw down
retirement funds in a tax-optimized way. "
Charles Schwab's managed account
availability numbers are also high-71% of
Art by Carol Rollo
its plans offer managed accounts to participants.
" Our standard offering is a combination
of point-in-time advice and full discretionary
managed accounts, " says Nathan
Voris director of investments, insights and
consultant services for Schwab Retirement
Plan Services in Richfield, Ohio.
Managed accounts provide personalized
investment recommendations for a
participant based on known data about the
person from either recordkeepers or sponsors;
further information may be added
when the participant engages. " The optimization
tools and the investment capabilities
have evolved and improved because of
the data that's available, " Voris says.
Meanwhile, the fees for managed
accounts have been falling. " There has
been rising interest in managed accounts,
and there has definitely been a reduction in
fees for the service over time, " says David
Blanchett, head of retirement research
for PGIM DC Solutions in Newark, New
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PLANSPONSOR - February - March 2022

Table of Contents for the Digital Edition of PLANSPONSOR - February - March 2022

INSIGHTS
INDUSTRY ANALYSIS
RULES & REGULATIONS
UPFRONT
Let’s Talk
Let It Grow
When Workers Retire in Stages
Virtual Lessons Learned
Managed Accounts, Today
How ‘Well’ Is ‘Well’ Enough?
Differentiation by Income
FIDUCIARY FORUM
INSIDE ANGLE
PLAN PROFILE
PLANSPONSOR - February - March 2022 - Cover1
PLANSPONSOR - February - March 2022 - Cover2
PLANSPONSOR - February - March 2022 - 1
PLANSPONSOR - February - March 2022 - INSIGHTS
PLANSPONSOR - February - March 2022 - 3
PLANSPONSOR - February - March 2022 - INDUSTRY ANALYSIS
PLANSPONSOR - February - March 2022 - 5
PLANSPONSOR - February - March 2022 - RULES & REGULATIONS
PLANSPONSOR - February - March 2022 - 7
PLANSPONSOR - February - March 2022 - 8
PLANSPONSOR - February - March 2022 - 9
PLANSPONSOR - February - March 2022 - UPFRONT
PLANSPONSOR - February - March 2022 - 11
PLANSPONSOR - February - March 2022 - 12
PLANSPONSOR - February - March 2022 - 13
PLANSPONSOR - February - March 2022 - 14
PLANSPONSOR - February - March 2022 - 15
PLANSPONSOR - February - March 2022 - 16
PLANSPONSOR - February - March 2022 - 17
PLANSPONSOR - February - March 2022 - Let’s Talk
PLANSPONSOR - February - March 2022 - 19
PLANSPONSOR - February - March 2022 - 20
PLANSPONSOR - February - March 2022 - 21
PLANSPONSOR - February - March 2022 - Let It Grow
PLANSPONSOR - February - March 2022 - 23
PLANSPONSOR - February - March 2022 - 24
PLANSPONSOR - February - March 2022 - 25
PLANSPONSOR - February - March 2022 - When Workers Retire in Stages
PLANSPONSOR - February - March 2022 - 27
PLANSPONSOR - February - March 2022 - 28
PLANSPONSOR - February - March 2022 - 29
PLANSPONSOR - February - March 2022 - Virtual Lessons Learned
PLANSPONSOR - February - March 2022 - 31
PLANSPONSOR - February - March 2022 - Managed Accounts, Today
PLANSPONSOR - February - March 2022 - 33
PLANSPONSOR - February - March 2022 - How ‘Well’ Is ‘Well’ Enough?
PLANSPONSOR - February - March 2022 - 35
PLANSPONSOR - February - March 2022 - Differentiation by Income
PLANSPONSOR - February - March 2022 - 37
PLANSPONSOR - February - March 2022 - FIDUCIARY FORUM
PLANSPONSOR - February - March 2022 - INSIDE ANGLE
PLANSPONSOR - February - March 2022 - PLAN PROFILE
PLANSPONSOR - February - March 2022 - Cover3
PLANSPONSOR - February - March 2022 - Cover4
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