Cerulli Associates estimates that public and private defined contribution plan assets will reach $7.3 trillion by 2017.
In the Boston-based global analytics firm’s latest report, U.S. Retirement Markes 2012: Market Sizing, Projections, and Segmentation of Public and Private DB and DC, it provides a comprehensive view of the size and segmentation of public and private U.S. retirement markets, including defined benefit, defined contribution and IRA.
"The 401(k) market is the largest driver of growth in the private DC industry, and it remains the largest component of the market," said Alessandra Hobler, a Cerulli analyst. "401(k) plans have become the primary savings vehicle for many private sector employees. As automatic features continue to gain traction, further implementation of these features may increase participation and deferral rates, contributing to plan asset growth."
"Within the public DC market, 403(b) plans were historically used as a supplemental savings vehicle, however as more retirement income responsibility is placed on the employee, 403(b) plans have been more ‘401(k)-like,’ acting as a primary savings vehicle for many large nonprofit organizations," she said.
The DC market is becoming increasingly competitive for asset managers. Firms with consistent outperformance and knowledge of the distribution landscape across plan types and plan size segments will be the most successful.
Headquartered in Boston with offices in London and Singapore, Cerulli Associates provides financial institutions with guidance in strategic positioning and new business development.
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