In a recent PLANADVISER article, titled Hub Projects Compliance, Due Diligence, Well-Being Will Be Essential to Plan Success in 2025, Jim O’Shaughnessy discusses HUB’s 2025 Outlook report and what the predicted trends mean for employers and advisors.
HUB’s 2025 Outlook: Retirement and Private Wealth highlights key predictions for the upcoming year, with one of the most significant being a return to the fundamentals of plan administration and management. As the retirement plan landscape continues to evolve, maintaining a strong focus on compliance, due diligence, and risk management will be critical.
A surfacing trend Jim makes note of is the increasing comfort employers are having with long-term participants—i.e. former employees staying in a plan after they leave for another company or retire. Jim attributes the cause of this trend to evolutions in plan design and digital communications decreasing administrative burdens, as well as a broader culture of employers truly wanting to help their employees – past and present – by giving them access to the benefits and pricing of institutional services for as long as it is useful to them. A cost-consciousness has also risen in employers who have found that having a larger plan can often result in cost savings. For example, the increasingly popular defined contribution investing vehicle, collective investment trusts, offer lower rates as the plan size goes up.
Of course, larger plans and more participants do produce risk, so maintaining the basic best practices of compliance and due diligence is key to helping protect against litigation, regulatory issues, and cybercrime. However, it’s not just about “getting the basics right”—it’s also about empowering employees with tools that improve their retirement readiness.
HUB’s Outlook 2025 report found that by 2026, almost half of employers will offer a financial planning program for employees. Employees are seeking these resources, and employers stand to benefit from the reduced stress and increased engagement of their employees when they provide them.
Another expected strategy for mitigating risk without sacrificing simplicity, according to the Outlook 2025 report, is active/passive mirroring —i.e. offering both active and passive investment options in the plan. As Jim explained in the article, “It’s the best of all worlds now in some ways, because you can offer the best of both active and passive while at the best price and scale.”
Finally, Jim covers the potential that new technology is creating for plans to do more for their employees – particularly through personalized investment and service offerings based on their individual needs.
“We very much want to utilize everything that the industry has available to create a more personalized experience: better engagement, better long-term results.”
– Jim O’ Shaughnessy, President of HUB Retirement and Wealth Management – Northbrook, IL
HUB RPW is proud to be a thought leader in the evolving retirement plan landscape. We’re all working toward a future where employees are highly engaged and able to pursue their financial goals with confidence. To explore other products and predictions in our Outlook 2025 you can learn more here.
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