t’s always important for retirement plan advisors to know the primary concerns and interests of 401(k) participants in order to be able to communicate with them effectively.

Invesco recently conducted some new research on the mindset of participants, and in this episode of the 401(k) Specialist Pod(k)ast, we talk with Greg Jenkins, Managing Director and Head of Institutional Defined Contribution at Invesco, who shares some surprising findings uncovered by the new research, and what advisors can learn from it.

Key Insights:

1. Participants’ Financial Concerns: Inflation, rising costs, and healthcare expenses are top concerns for 401(k) participants, significantly outweighing worries like job security.
2. Miscommunication on Retirement Income: Only 30% of participants recall receiving information about turning 401(k) balances into retirement income, highlighting a communication gap.
3. Target Date Fund Misunderstandings: A significant percentage of participants misuse target date funds, holding multiple TDFs or combining them with other investments for "diversification".

Invesco partnered with Ipsos to conduct an online survey of 583 defined contribution plan participants (May-July 2024). Participant respondents had following characteristics: Age 25-65 years old; Personal income $30,000+; Employed full-time for an organization for 1+ years; Employer has 1,000+ employees; Actively contributing to a defined contribution plan; Does not work in education, financial services, the federal government, or involved in the management of or decisions regarding employer’s retirement plans.

Source for all data: May 2024 online survey by Invesco and Ipsos. Invesco is not affiliated with Ipsos.

Invesco Distributors, Inc. is the US distributor for Invesco’s retail products.

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