Trend-watching financial advisors are now offering a home to clients' "orphan" retirement plans, and taking advantage of this often-overlooked opportunity to add to their assets under management.

These orphaned assets, which sit in 401(k) plans that get left behind and neglected when mass affluent professionals switch jobs, offer a huge opportunity to savvy advisors, according to Teresa Epperson, managing director in the Financial Services Practice at AlixPartners, a management consultant that recently conducted a study of dormant retirement plans.

Ten percent of mass affluent investors moved their money last year, to the tune of $750 billion, while 27 percent of mass affluent investors admitted to holding anywhere from $100,000 to $500,000 in dormant assets in what Epperson refers to as "orphan" 401(k) accounts. Advisors with effective client-education programs stand to add considerable sums to AUM if they hop on this trend, Epperson believes.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.