News provided by J.P. Morgan Asset Management at PRnewswire J.P. Morgan Asset Management released a new Retirement Insights paper, "Three Ways to Help Improve Participants' Retirement Outcomes in a Lower-Return World."
The piece addresses implications specific to defined contribution plan sponsors and participants from the firm's 2017 Long-Term Capital Market Assumptions as expectations for market returns over the next 10 to 15 years have declined for most asset classes.
"Individuals already struggling to achieve a financially secure retirement face an intensifying challenge.
Not only are they living longer, they are also confronted with declining expectations for long-term returns on their retirement assets," said Anne Lester, Head of Retirement Solutions, J.P. Morgan Asset Management.
"Now more than ever, a secure retirement requires saving adequately and investing wisely.
We encourage plan sponsors to take action to help improve retirement outcomes by 1) encouraging participants to save more through the use of automatic plan design features; 2) considering professionally managed portfolio strategies like target date funds that can make portfolio diversification easier; and by 3) providing participants with the opportunity to enhance returns through the use of active management."
Although the outlook for long-term capital market returns has been downgraded, the paper illustrates ways automatic plan design options can be used by plan sponsors to place and keep more participants on the road to a secure retirement.