- CIT Solutions
-
A Superior Collective Investment Trust Onboarding Experience.
-
- Perspectives
- About
- Reach out
A Superior Collective Investment Trust Onboarding Experience.
A Superior Collective Investment Trust Onboarding Experience.
Same investments. Same manager. Same strategy. The only difference is the fee, and over a career it can cost a participant $280,000.
According to the Department of Labor, over a 35-year career, a 1% difference in fees and expenses reduces an account balance at retirement by 28%.¹ For someone on track to save $1 million, that is $280,000 lost solely to excess costs.
That math is a big reason collective investment trusts (CITs) are now the most prevalent investment vehicle in defined contribution plans. Morningstar’s 2026 Retirement Plan Landscape Report shows the average actively managed mutual fund is more than 3x as expensive as the average actively managed CIT. For passive funds, the gap is 4.4x.²
The savings don’t stop at retirement. In an illustrative scenario from the webinar, a participant who starts saving at 25 in a CIT instead of a mutual fund with the same strategy and returns gets eight more years of retirement spending. The account lasts to age 102 instead of 94.
Lower cost doesn’t mean lower protection. CITs operate under banking law and, when they hold plan assets, ERISA’s fiduciary standards. Access has changed too. With investment minimums reduced or eliminated, even the smallest plans can build investment lineups around CITs.
In The Forces Reshaping Retirement: Why CITs Are at the Center of It All, Jason Levy, Deputy General Counsel and Head of Retirement Policy at Great Gray, breaks down what is driving the shift and what it means for plan sponsors, advisors and investment committees. For anyone preparing for the next conversation about CITs, it is a clear place to start.
Sources:
The age 94 vs. 102 scenario is hypothetical and for illustration only (age 25 start, $60K starting salary, 10% combined contribution, 8% gross return through age 65 and 6% thereafter, 5% initial withdrawal rate, 2.5% annual withdrawal growth). Actual results will vary. Standard Great Gray CIT disclosures apply.
Great Gray Trust Company, LLC Collective Investment Funds (“Great Gray Funds”) are bank collective investment funds; they are not mutual funds. Great Gray Trust Company, LLC serves as the Trustee of the Great Gray Funds and maintains ultimate fiduciary authority over the management of, and investments made in, the Great Gray Funds. Great Gray Funds and their units are exempt from registration under the Investment Company Act of 1940 and the Securities Act of 1933, respectively.
Investments in the Great Gray Funds are not bank deposits or obligations of and are not insured or guaranteed by Great Gray Trust Company, LLC, any bank, the FDIC, the Federal Reserve, or any other governmental agency. The Great Gray Funds are commingled investment vehicles, and as such, the values of the underlying investments will rise and fall according to market activity; it is possible to lose money by investing in the Great Gray Funds.
Participation in Collective Investment Trust Funds is limited primarily to qualified retirement plans and certain state or local government plans and is not available to IRAs, health and welfare plans and, in certain cases, Keogh (H.R. 10) plans. Collective Investment Trust Funds may be suitable investments for plan fiduciaries seeking to construct a well-diversified retirement savings program. Investors should consider the investment objectives, risks, charges, and expenses of any pooled investment fund carefully before investing. The Additional Fund Information and Principal Risk Definitions (PRD) contains this and other information about a Collective Investment Trust Fund and is available at www.greatgray.com/cit-fund-info/principal-risk-definitions/ or ask for a free copy by contacting Great Gray Trust Company, LLC at (866) 427-6885.
Great Gray® and Great Gray Trust Company are service marks used in connection with various fiduciary and non-fiduciary services offered by Great Gray Trust Company, LLC.