Trending Themes in Asset and Wealth Management
- Retiree Rollovers at a Crossroad: Recordkeepers Fight the IRA Exodus - As record retirement waves hit 401ks, misaligned rollover incentives and limited in‑plan decumulation are accelerating IRA leakage prompting recordkeepers to rethink retention, advice, and income delivery as core services
- The Repricing of Advice: From Performance to Outcomes in Wealth Management - Investors are increasingly willing to pay for advice, but only when it delivers measurable outcomes beyond performance driving wealth firms to modernize platforms, personalize at scale, and engage heirs earlier
- Institutional ETF Adoption Signals a Strategic Growth Opportunity for Asset Managers - Rapid growth in institutional ETF usage is elevating ETFs into a core portfolio tool, creating a strategic opportunity for asset managers to scale active, outcome‑oriented, and institution‑designed ETF solutions
These interconnected trends underscore a dynamic environment where evolving client expectations, a focus on comprehensive service, and a fundamental shift in investment vehicle preferences are collectively shaping the opportunities and challenges for Asset and Wealth Management firms aiming for future growth. This collective evolution signals a profound transformation across the sector, pushing firms to rethink traditional models and embrace new approaches to remain competitive and relevant
Retiree Rollovers at a Crossroad: Recordkeepers Fight the IRA Exodus
Introduction
- A demographic tidal wave hits 401(k) plans. An estimated 11,200 Baby Boomers turn 65 daily through 2027, shifting unprecedented volumes of assets from accumulation into decumulation reported by 401(k) participants for making hardship withdrawals. The median size of the withdrawal was $1,900
- Retention strategies lag reality. According to Callan DC Trends Survey published in Apr’26, only 36% of mega DC sponsors have a formal approach to retain retiree or terminated balances in‑plan. Among those, 86% prioritize retirees’ larger accounts (Sample population: 80 mega DC plan sponsors, both Callan clients and other organizations)
- Many retirees lack guidance at the rollover moment. The 2026 EBRI/Greenwald survey (Apr’26) shows over 40% of workers and 25% of retirees don’t know where to seek advice, while nearly half retire earlier than planned (median age 62), compounding poor rollover preparedness (Sample population: 2,544 Americans aged 25+; Includes 1,007 workers and 1,045 retirees, plus an oversample of 492 caregiver respondents)
Setting the Context: Retention intent collides with rollover economics. Sponsors want retention but roll-ins remain uncommon
- Sponsor–recordkeeper incentives are misaligned on rollovers. While 86% of sponsors with a retention strategy prioritize keeping retiree assets in‑plan, recordkeepers often have commercial incentives to migrate those assets into proprietary IRAs at separation making rollover capture a growing fiduciary governance issue in 2026 (Callan, Apr’26)
- In‑plan roll‑ins remain uncommon despite flexibility. Nearly 6 in 10 sponsors report that fewer than 10% of participants roll assets into the plan from prior employers, and only 7% express interest in automatic roll‑ins for small balances highlighting persistent frictions in asset consolidation (Callan, Apr’26)
Industry Response & Adaptation: As rollover scrutiny intensifies and retiree leakage becomes more visible, leading recordkeepers and asset managers are re‑engineering products, technology, and portability infrastructure to keep assets connected to plans
- Transamerica (Mar’26): Launched Pearl, an AI virtual assistant that streamlines consolidation of prior‑employer accounts and IRAs into current plans reducing friction and leakage at job change and retirement
- Portability Services Network (Q1 ’26): Expanded to cover 21,500+ plans, automatically rolling small, stranded balances into new employer plans, projected to reduce cash‑out leakage
- Vanguard & TIAA (Dec ’25): Through a joint partnership, Vanguard contributes the target‑date fund structure and glidepath, while TIAA provides the embedded guaranteed‑income/annuity component, enabling participants to convert a portion of assets into in‑plan lifetime income without rolling to an IRA
Evalueserve Perspective
Recordkeepers may consider pursuing the following initiatives:
- Make retiree retention explicit: Co‑design formal retention programs with sponsors, including clear rollover communications, competitive pricing for retirees, and governance‑aligned sales practices
- Treat decumulation as a core service: Offer default systematic withdrawals, simple drawdown portfolios, and explainable in‑plan income options to turn flexibility into actual retention
- Close the advice gap early: Provide proactive, neutral guidance— income projections, rollover comparisons, and pre‑retirement outreach—to materially improve in‑plan outcomes and withstand fiduciary scrutiny
The Repricing of Advice: From Performance to Outcomes in Wealth Management
Introduction
- April’26 reinforced a pivotal shift in wealth management: Clients are increasingly willing to pay for advice, but their definition of “value” is expanding well beyond performance
- Cerulli’s Apr’26 update reports that 68% of affluent investors are willing to pay for financial advice (based on 2025 findings), marking a meaningful rise versus prior years and underscoring that advice is increasingly viewed as an explicit paid service—not an implicit add-on
- The same update clarifies why willingness to pay scales with wealth. As assets grow, complexity intensifies across taxes, financial and estate planning, and access to more sophisticated vehicles (e.g., SMAs and alternatives), making advice inherently more multidimensional and outcomes-oriented
Setting the Context: The Great Wealth Transfer is also reshaping retention Natixis’ 2026 commentary notes that large-scale intergenerational transfers often become points of attrition when advisors fail to establish early relevance with spouses and heirs
- Heirs are driven less by legacy relationships and more by trust, engagement, and perceived relevance, prompting many to reassess whether incumbent advisory models meet expectations
- Together, these signals underscore a clear industry reality: clients may be willing to pay for advice, but are increasingly discerning—re-pricing advice based on advisor capability and platform strength to address taxes, alternatives, estate and legacy planning, and complex multi-goal financial needs globally
Industry Response & Adaptation: In response, wealth firms are modernizing how advice is delivered, not just how it is positioned. Model portfolios, SMAs, UMAs, and deeper platform integrations are reducing friction across public and private allocations, enabling advisors to personalize at scale while maintaining governance, transparency, and consistency
- Ameriprise (Apr’26): Expanded the range of investment models available on its UMA platform, giving advisors more flexibility to deploy diverse strategies within a single account structure. This reinforces models as a primary delivery mechanism—supporting scalable, standardized construction while enabling differentiated outcomes aligned to client goals
- iCapital × Envestnet (Apr’26): Enhanced UMA capabilities by enabling advisors to implement iCapital-sourced alternatives and structured products alongside traditional assets within the same account framework. Embedding alternatives into managed-account workflows reduces operational friction and signals a shift toward treating public and private assets as integrated components of repeatable portfolio construction
Evalueserve Perspective
Wealth management is moving decisively toward provable, outcomes‑led advice. As clients benchmark fees against real‑world results, firms must deliver advice as a scalable, repeatable capability across generations. To capitalize on this shift, AWM firms can consider:
- Re-orienting advice around outcomes, not products: Embedding tax efficiency, estate planning, access to alternatives, and multi-goal planning directly into advisory workflows and portfolio construction
- Designing family and heir-inclusive engagement models: Establish relevance with spouses and next-generation beneficiaries early, anchoring retention beyond the primary client
- Scaling personalization through platforms: Leveraging UMA/SMA structures, model portfolios, and integrated alternatives to deliver differentiated outcomes without increasing operational complexity
- Strengthening advisor enablement and communication: Ensuring platform evolution, pricing logic, and advice differentiation are clearly articulated and outcome-led—especially for younger, more discerning investors
Institutional ETF Adoption Signals a Strategic Growth Opportunity for Asset Managers
Introduction
- According to a new first-of-its-kind study by Cerulli Associates and Invesco, institutional asset owners have nearly doubled their ETF usage over the past five years, with total ETF assets reaching approximately $337 billion in 2025
- Institutional ETF holdings increased at a 14.4% CAGR from 2020 to 2025, significantly outpacing growth in the broader U.S. institutional market– highlighting an opportunity for asset managers to strengthen institutional relationships through differentiated ETF solutions
Setting the Context: Institutional ETF adoption is accelerating as efficiency gains and product innovation expand their use across both strategic and tactical allocations
- Improved liquidity, lower fees, and greater operational efficiency are driving institutional use of ETFs, while a broader and more diverse ETF universe is reducing historical limitations related to product depth and performance history
- Cerulli research indicates nearly half of current institutional ETF users plan to increase allocations over the next 24 months, while 16% of non-users expect to initiate ETF usage, signaling sustained momentum
Industry Response & Adaptation: Asset managers are responding by evolving ETF offerings to better align with institutional needs - expanding targeted, active, and defined‑outcome strategies, acquiring ETF platforms, and launching ETF share classes of institutional mutual funds to combine active management with ETF efficiency
- State Street × Thornburg (Apr ’26): Partnered to launch ETF share classes of existing institutional mutual funds, reflecting growing demand from institutional investors
- BlackRock (iShares) (Mar’26): Expanded its iBonds franchise adding nearly a dozen new term-maturity ETFs for Treasuries, Munis, and corporate bonds with maturities extending as far as 2056 to cater to institutional channels
- Goldman Sachs (Dec ’25): Announced the acquisition of Innovator Capital Management, materially expanding its defined‑outcome and active ETF platform— segments increasingly leveraged by institutions to optimize risk budgeting and enhance liquidity
Evalueserve Perspective
Rising institutional ETF adoption represents a compelling strategic growth lever for asset managers, particularly as institutions seek vehicles that combine risk control, scalability, and operational efficiency with more precise outcome objectives. To capitalize on this shift, asset managers can consider:
- Expanding active and outcome‑based strategies, including buffer, income‑oriented, and defined‑outcome ETFs that address institutional requirements for downside protection and return targeting
- Institutional co-creation, Firms need to move beyond pilots and integrate GenAI into client facing tools, advisor workflows, and operations
- Bringing private‑market exposure into public markets To remain competitive, wealth managers must deploy Agentic AI to automate multi step processes, while linking them to existing core systems and custodial APIs to reduce manual error and latency
