Sponsors of 401(k) plans are increasingly recognizing the need to provide personalized investment options for their participants; however, access to managed accounts still remains limited.
According to PGIM DC Solutions’ 2025 DC Plan Sponsor Landscape Survey, a resounding 88% of plan sponsors believe that personalized advice and guidance will significantly improve retirement outcomes. Despite this strong consensus on the value of personalized investment strategies, managed accounts are not widely available.
While 60% of plan sponsors with assets over $100 million offer managed accounts, only 35% of those with assets between $10 million and $99 million either provide these accounts or are even aware of them. This limited availability is primarily attributed to cost, as managed accounts commonly involve high fees. Interest in managed accounts at current pricing levels, usually around or exceeding 25 basis points, remains low.
Still, 70% of plan sponsors assert that they would consider offering managed accounts as an opt-in option if fees were reduced to 10 basis points or less. Additionally, 63% would be enthusiastic about having managed accounts as their plan’s default investment at that competitive price point.
