Approximately $720 billion of 401(k) assets eligible for distribution remained in employer-sponsored plans in 2013, according to research from Cerulli Associates.
That's twice as much eligible money that was rolled out of plans, according to Chris Nadai, senior analyst at Cerulli.
"The fact that a majority of assets eligible for distribution remain in plan each year indicates that many 401(k) participants are hesitant to take action with their prior accounts," explained Nadai.
Recommended For You
"This is a great opportunity for financial advisors and record-keepers to inquire about prior employment history in order to determine whether there are abandoned accounts."
Cerulli estimates that assets in all defined contribution plans total $6.4 trillion.
Rollover contributions were $324 billion in 2013.
Cerulli expects annual IRA rollovers to increase over the next five years as baby boomers begin to retire in earnest, putting the retirement assets of up to 10,000 boomers a day into motion.
That could mean an unprecedented opportunity for IRA providers.
"Establishing a relationship with retirement plan participants is essential for record keeper and IRA providers," added Nadai. "One of the major advantages record keepers' have in capturing rollovers is that they can be in immediate contact with a participant when there is a change in their work or personal life."
About 28 percent of survey participants said their 401(k) provider was their primary source of financial advice.
As the first full wave of defined contribution plan beneficiaries gets set to retire, Cerulli estimates that those between ages 55 and 69 hold $15.7 trillion of investable assets–$7 trillion of which is in defined contribution plans or IRAs.
While the paper says there is no arguing the potential bounty going forward for IRA providers and RIAs, it does say that the marketplace will remain intensely competitive.
About 70 percent of rollover assets in 2013 went to providers and advisors with existing client relationships, suggesting how challenging it will be for providers and RIAs to capture new business from baby boomers as they retire.
© 2025 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.
Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
