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Merrill, Fidelity, Vanguard Rank Tops in Cogent 401(k) Loyalty Survey of Plan Providers

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A Cogent Research survey of 401(k) plan sponsors ranks Bank of America Merrill Lynch with the highest loyalty rating for providers in the micro market of $5 million or less, while Fidelity Investments rates highest among small plans of $5 million to $20 million, and Vanguard rates highest with mid-size plans of more than $20 million.

The national survey of plan sponsors shows ING and Mass Mutual in second and third place, respectively, among 10 leading providers in the micro market. Principal Financial Group came second and Mass Mutual came third among 11 small plan providers, and Charles Schwab came second and Fidelity came third among 10 mid-size plan providers.

For micro retirement plan providers, administrative support was the most critical driver of sponsor loyalty across seven areas of service delivery. Small sponsors called for a broader set of services, including plan participation support and fees in addition to administrative support. Mid-size sponsors most valued the ability of providers to help with participant communications and problem solving.

“These results clearly illustrate how difficult it is for any single provider, even giants like Vanguard or Fidelity, to garner top loyalty ratings across multiple segments,” said Cogent principal John Meunier in a June 16 news release. “Each market is a different ball game, and there are clearly niche players capitalizing on unique strengths in each arena.”

The Web-based survey, Retirement Planscape 2010, was based on the responses of 2,193 401(k) sponsors in the United States. Founded in 1996 and based in Cambridge, Massachusetts, Cogent provides custom research, syndicated research products, and evidence-based consulting to organizations in the financial services, life sciences, and consumer goods industries.

“These findings reflect the day-to-day realities that sponsors face across the full spectrum of plan sizes,” Meunier said. “At the most basic level, micro-plan sponsors need help getting their plans up and running. As plan assets grow, so too do sponsor needs, not only to manage the plan but participants and costs as well. And when we’re talking about the biggest plans, it’s more about accountability to stakeholders, and keeping the plan and participants on track.”

Read a story about a Cogent study of IRA assets from the archives of


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