Lord Abbett will no longer provide bundled 401(k) services to the retirement plan market, and instead will focus on just offering investments to defined contribution plans
Lord, Abbett & Co. LLC is exiting the business of offering bundled 401 (k) plans — and has agreed to transition its nearly $1.2 billion in 401(k) assets to The Hartford Financial Services Group Inc.
Officials for Lord Abbett today said that the asset management firm will now focus on offering investments alone to defined contribution plans, rather than packaged products that included other services, such as record-keeping, to the 401(k) section of the retirement market.
“The business got mature and a lot of advisers were asking for access to multiple managers for a plan,” said Frank Gregory, a partner and director of retirement platforms at Lord Abbett, who added that movement towards open architecture was a factor in making the strategic shift in the business.
“Advisers like the flexibility that they have access to more than one fund family,” said Mr. Gregory.
As a result of the shift in strategy, Lord Abbett will move its existing 8,000 plans — with 59,900 participants and more than $1.2 billion in 401(k) assets — over to Hartford Retirement Services LLC, a unit of The Hartford Financial Services Group Inc.
“We didn't want to be viewed as competition because we offered record keeping,” Mr. Gregory said. “We think there is an inherent conflict when you are selling a retirement plan and also trying to be a valid partner and participate in other retirement plans and potentially targeting the same plan sponsor.”
Lord Abbett had approximately $81 billion in assets under management as of Aug. 31.
“The business got mature and a lot of advisers were asking for access to multiple managers for a plan,” said Frank Gregory, a partner and director of retirement platforms at Lord Abbett, who added that movement towards open architecture was a factor in making the strategic shift in the business.
“Advisers like the flexibility that they have access to more than one fund family,” said Mr. Gregory.
As a result of the shift in strategy, Lord Abbett will move its existing 8,000 plans — with 59,900 participants and more than $1.2 billion in 401(k) assets — over to Hartford Retirement Services LLC, a unit of The Hartford Financial Services Group Inc.
“We didn't want to be viewed as competition because we offered record keeping,” Mr. Gregory said. “We think there is an inherent conflict when you are selling a retirement plan and also trying to be a valid partner and participate in other retirement plans and potentially targeting the same plan sponsor.”
Lord Abbett had approximately $81 billion in assets under management as of Aug. 31.
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