With fewer and fewer employers providing defined benefit plans, the defined contribution plan has become one of the primary ways for Americans to save for retirement. Defined contribution plans are cheaper in the long run for employers, and they work as an attractive benefit. Even people under 35, who do not have retirement security as their top priority, want their employer to offer a 401(k) plan. Mintel’s exclusive consumer research found that 56% of respondents under 35 who did not participate in a plan wanted their employer to offer one.

With fewer and fewer employers providing defined benefit plans, the defined contribution plan has become one of the primary ways for Americans to save for retirement. Defined contribution plans are cheaper in the long run for employers, and they work as an attractive benefit. Even people under 35, who do not have retirement security as their top priority, want their employer to offer a 401(k) plan. Mintel’s exclusive consumer research found that 56% of respondents under 35 who did not participate in a plan wanted their employer to offer one.

With increased job mobility, the 401(k) rollover market is poised to take off. Expected to add $2.5 trillion to the IRA market over the next eight years (2005-2013), the rollover opportunity has been termed by one Fidelity executive as, “the biggest movement of assets that the financial services industry will ever see.”

To ensure their position in this market, savvy providers are focusing on getting closer to participants. Financial advice can be a smart strategy to gain mindshare and market share of plan participants for ancillary products. In Mintel’s research, we have found that participants are a knowledgeable, inquiring target market, ready and willing to be engaged with a discussion about their investments and their financial security. More than 52% already use professional assistance for making decisions regarding retirement accounts—and more than three-quarters want to know as much as possible before committing to a financial service.

This leaves a wide-open opportunity for providers to provide value-added service such as managed accounts. Mintel has found a genuine opportunity for investment managers: 34% of those who have a workplace retirement plan would be willing to pay a professional to manage their account. This acceptance of managed accounts cuts across all segments: young people, Baby Boomers, high and low income participants, married, unmarried, north, south, east, and west.

Mintel believes that the 401(k) plan market has room to grow, and that assets will increase along with number of participants. This is because more plans are automatically enrolling participants into age-targeted retirement funds. This should dramatically increase participation, increasing opportunities for platform providers and investment managers.