News & Updates

Study reveals that DC plans revamp investment strategies to cut costs and mitigate risks


June 11, 2024

According to an article by Pensions & Investments, Callan’s latest annual survey of defined contribution (DC) plans found that DC plans are aiming to reduce costs by adjusting their investment strategies.

The survey, reported by Pension + Investments, highlights several key trends:

  • Mirror Strategy Growth: 45% of plans now use a mirror approach with both active and passive options, up from 28% in 2022, driven by fee-related litigation concerns.
  • Increased Use of CITs: 82% of plans offered collective investment trusts (CITs) last year, reflecting a shift towards lower-cost options over mutual funds.
  • Fee Management: Most plans now use explicit fees over revenue-sharing to cover administrative costs, with 78% opting for per-participant fees.

Flexibility in plan management and transparent fee structures are driving these changes.

Click the link below to read the full release from Pensions & Investments:

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