Sponsors hand advisers the menu

Fidelity’s 17th annual Plan Sponsor Attitudes Study, first reported by PLANADVISER this morning, opens with what looks like a hand-off: 41% of surveyed plan sponsors now want their adviser to have full discretion over investment menu decisions, up from 36% in 2025. That five-point move in one year separates a cyclical blip from a renegotiation of the adviser’s job. Mike Manosh, Fidelity’s defined contribution investment-only sales lead, reads it as a capacity problem rather than a confidence problem—most sponsors are not running retirement plans as their sole responsibility, and they are realizing, in his words, “I’ve got to lever specialists, and I’ve got to outsource to the extent that I can.”

The survey, conducted online in January among 1,311 plan sponsors with at least 25 plan participants and $3 million in plan assets, also shows 93% of sponsors already work with an adviser. Asked what support they need from that adviser, 56% cite legislative and fiduciary issues, 53% cite individual retirement planning assistance for employees, 52% cite analysis of plan metrics and recommendations, and 52% cite financial wellness education. The legislative and fiduciary answer at the top says sponsors feel regulatory complexity most, and full discretion is one way out.

This is not a sponsor-side anomaly; J.P. Morgan Asset Management found 73% of surveyed workers would push an “easy button” to completely delegate their retirement planning and management, and Steve Rubino, the firm’s head of retirement, described that as participants needing “someone to help them along that journey.” The sponsor version of the easy button is handing over the menu. For advisers, the practical change is bigger than the survey line suggests: a recommendation business can run on quarterly committee meetings and a benchmarking report, while a discretion business runs on a documented fund-evaluation process, a monitoring calendar, and a willingness to stand behind menu decisions between annual reviews—different economics and a different service model.

The RFP will catch up to the attitude shift. Sponsors who once asked advisers what they would recommend will start asking what authority they are willing to take. Advisers who answer with education-only work will find themselves competing with firms that can document a discretionary process, and the ones without that infrastructure will be squeezed into a narrower role—running enrollments and wellness seminars while the menu decision goes elsewhere. That direction is already in the Fidelity data.

The shelf also shows where sponsors expect discretion to land: 89% say adding new investment options is a goal over the next 12 months, 52% are considering replacing their current target-date funds, and the products drawing the most interest are target-date funds with embedded annuities at 55% and with stable value at 52%, ahead of managed accounts at 41% and active ETFs at 31%. That first pair carries the weight: the income conversation has moved past side funds and carve-outs to the default itself.

Fidelity’s figures reinforce what this publication has argued: guaranteed income is moving from product design to distribution. Sway Research’s mid-year report found income-linked target-dates up 18% in the first half while target-date assets grew 11%. A 55% citation rate for annuities embedded in target-dates suggests the income conversation has reached the request-for-proposal stage. The hard part is execution: delivering an annuity inside a target-date requires manufacturing scale, recordkeeper integration, and a fiduciary process that can weigh the income guarantee without fixating on the fee. That lifts the bar for the adviser who wants to own the menu.

The full-discretion number should also be read against the expansion of adviser services the survey records: 48% of sponsors say their adviser has added financial planning and advice, 42% cite broader benefits strategy consulting, 42% cite employee education, and 42% cite adviser-managed accounts. That last figure—adviser-managed accounts at 42% on a list of expanded services—is the clearest sign that sponsors are comfortable letting the adviser run money inside the plan, not just talk about it. Fidelity’s data says sponsors are still hiring advisers—93% work with one—but they are hiring them to carry more of the plan. The advisers who build the infrastructure to accept the menu will set the terms of the next decade; those who keep selling recommendations will find themselves at the table’s far end.