COLLECTED WISDOM™ on Retirement Plan Advisor's Practice Management
Here is a collection of articles, commentary, insights and other information around issues dealing with a retirement plan advisor's practice management including growing your book, running your business, and best practices.
This archive contains not only the most current material on the topic, but also older items that are still relevant, provide background, perspective or are germane to the topic.
If you find a broken link or an items that you feel is outdate, irrelevant or no longer appropriate, please let us know.
If you currently work with 401k and profit-sharing plans, expanding the reach of your practice to serve 403b plans can uncover a whole new world of potential opportunities. The expertise and experience you have gained serving 401k plans can be fully leveraged to serve 403b plan sponsors and their employees.
Source: 401kspecialistmag.com, January 2023
The SEC Is 'Coming After' RIAs That Fail to Track Client Chats by Text, Whatsapp, and Social Media, Experts Say
The smartphone's advance took life one giant step forward for RIAs, but they can't fight the law of unintended consequences and it may already have won. Smartphones make our business and personal lives porously one. Yet from the SEC's perspective, no such blurred line exists, and every mobile chat with a client pertaining at all to business is subject to compliance.
Source: Riabiz.com, October 2022
Advisors have a primary choice between partnering with companies who sell insurance or investments and offer 401k plans as part of their financial services lineup and independent recordkeepers who tend to be local or regional specialists who focus on actively collaborating with financial and tax advisors to design and operate retirement plans tailored to their clients. This piece reviews four ways an independent recordkeeper can help you grow your retirement plan practice.
Source: Abgnational.com, October 2022
Nearly 50% of plan sponsors are actively looking for a new advisor. It's been said that it costs seven times more to earn a new client than it does to retain a current one. As you implement your business plan, consider these five client retention strategies. These ideas could have a big impact on how your clients perceive the quality of your service, could increase loyalty, and even produce inbound referrals.
Source: 401k-marketing.com, September 2022
This article is part of a series providing a framework for incorporating sustainable investing into your advisory practice. A previous article explored the limitations and opportunities of investing sustainably within employer-sponsored retirement plans such as 401ks. Advisors supporting clients in investing sustainably outside of these accounts may find more choice but also more complexity.
Source: Morningstar.com, August 2022
Building a book of retirement plan clients is tough work. Clients don't fall from trees and it can take months or years to land that potential client you have visited and called countless times. And it is easier to lose a client than it is to gain one. If you follow some of the steps outlined here, you can avoid losing your retirement plan clients.
Source: Jdsupra.com, August 2022
This study shares insight on retirement trends from our latest survey of the nation's 32 leading consulting and advisory firms that provide services to more than 33,000 plan sponsor clients and report nearly $7.2T of assets under advisement. The study was conducted at the end of 2021 during the continued coronavirus pandemic. Recent years have presented unprecedented challenges, and the study finds the consulting and advisory community evolving their businesses to address both obstacles and new opportunities.
Source: Troweprice.com, June 2022
The rule requires written disclosures to your prospects and clients that outline the reason the rollover recommendation is in their best interest. The author poled the advisor community and received 25 detailed responses. He says that "at first it was bewildering because none of the disclosure forms or checklists looked like any of the others. But when I looked closer, there were some commonalities that I fit into a composite disclosure document that the profession can rally around. At the very least, it shows you the thinking of people who have put a lot of thought into this issue. I can offer an even dozen of observations from the responses."
Source: Advisorperspectives.com, June 2022
What should advisors be asking their TPAs? What should they be getting from them? What makes the difference between a good TPA and a bad one? And how can advisors and TPAs improve their working relationship and serve plan sponsors as a cohesive team? This panel discussion at the 2022 NAPA 401k Summit provides an interesting perspective on the relationship between TPAs and advisors, their work and connections, and the approach and mindset advisors follow. TPAs may find this information and insight useful and instructive.
Source: Asppa.org, April 2022
Fee compression has impacted adviser revenue models for several years now, thanks to such forces as increasing automation, stiffer competition, and ongoing industry consolidation. Experts say these trends are set to continue throughout 2022, leaving forward-thinking advisers focused on protecting existing revenue and adding new revenue streams.
Source: Planadviser.com, February 2022
As we begin 2022, now is an opportune time to set yourself up for success in the coming year. Here are some hot industry trends you can expect to be front and center, as well as thoughts on how to leverage them to scale your practice while managing your client relationships and business more efficiently.
Source: Fiduciarydecisions.com, January 2022
To manage their responsibilities, plan sponsors should develop procedures that facilitate prudent decision-making and demonstrate that the plan sponsor is disciplined about following those procedures. RPAs can add value to their retirement plan support services by helping plan sponsors develop a strategy for satisfying their fiduciary responsibilities under ERISA, including a fiduciary calendar.
Source: Newportgroup.com, December 2021
Increasing retirement plan-focused litigation has put insurance carriers and fiduciary service providers in difficult positions. In this article published in PLANSPONSOR, McDermott Partner Erin Turley said such litigation continues to be a "major focus" in the fiduciary insurance marketplace. "It is a challenging market right now, to the point that we are looking at trying to think about ways that insurance products might be differently structured, to address what we hope will only be a short-term tightening in the market."
Source: Mwe.com, December 2021
As registered investment adviser aggregator firms continue to acquire smaller players in the defined contribution space, investment managers are starting to take notice of their growing influence in deciding DC plan investments, a recent study suggests. There has been a shift in distribution dynamics as many RIA firms look to centralize their investment analysis and research.
Source: Plansponsor.com, December 2021
Cybersecurity breaches are a growing concern among advisers, and, without sufficient protection, the benefits of America's workers may be at risk. With this challenge in mind, a recent panel discussion hosted by Fi360, a Broadridge company, detailed how to prepare a plan to keep up with current and future risks.
Source: Planadviser.com, October 2021
Amid the massive consolidation among 401k providers, the top five recordkeepers have distanced themselves from the pack. The Fab Five either have or are developing proprietary products and the ability to market other financial services to participants. The question that many are asking is, "Can any of the others compete, or even survive?"
Source: Investmentnews.com (registration may be required), August 2021
A webinar this week featured OneAmerica's Sandy McCarthy, the firm's president of retirement services, in conversation with Rebecca Hourihan, founder of 401k Marketing in San Diego. The pair discussed the many marketing challenges facing advisory industry practitioners, with a particular focus on the added complexities of marketing as a woman in a field in which older white men are significantly overrepresented. The pair agreed that marketing is a challenge for all advisers and one which is unfortunately all too often complicated by issues related to discrimination and stereotyping. However, with the right framework and strategies in hand, all advisers can use proven marketing tactics to grow and strengthen their business and their brand.
Source: Planadviser.com, April 2021
Most retirement plan advisers still lead with and focus on their "Triple F" services: fees, funds, and fiduciary. While those services are still important, they have been commoditized through benchmarking databases and reporting software. But RPAs have to go further if they want to become essential to the three clients they serve at a plan sponsor: the company, the person in charge of the 401k plan, and the employees.
Source: Investmentnews.com (registration may be required), February 2021
T. Rowe Price, in partnership with Schaus Group, completed a survey of the nation's 20 leading defined contribution consulting firms, representing over 5,500 plan sponsor clients and $3.9T of assets under advisement. The objective was to understand the view of DC consultants related to retirement and DC matters driving their business, market trends, and plan sponsor decisions.
Source: Troweprice.com, November 2020
Retirement plan advisers, perhaps more than any other experts in our industry, have a good sense of the relative strength of the products and services offered by investment and recordkeeping providers. This 2020 Retirement Plan Adviser Survey amasses data from the adviser community to discover how these individuals select providers and funds, plus, as in other years, to pick up on any developing trends.
Source: Planadviser.com (registration may be required), October 2020
The study features insights based on self-reported information on topics such as asset and revenue growth, sources of new clients, products and pricing, staffing, compensation, marketing, technology, and financial performance. Now in its fourteenth year, more than 1,000 independent advisor firms representing over a trillion dollars in AUM participated in this year's study.
Source: Schwab.com, July 2020
Retirement plan advisers who resume their practice as if nothing has changed after the strict social distancing rules and travel restrictions are lifted will miss out on significant opportunities and be left behind. The COVID-19 crisis will accelerate many trends that were percolating before the crisis, like industry consolidation and a focus on participants. This will create new opportunities and challenges. Here's how RPAs may want to evolve their 401k and 403b practices as the virtual world becomes a reality.
Source: Investmentnews.com (registration may be required), June 2020
For many advisors, recordkeeper RFPs conjure up thoughts of endless amounts of documents, countless back-and-forth conversations with candidates, and immense amounts of effort and time. While it's true that the recordkeeper RFP is an involved process that requires a generous amount of effort, many advisors fail to take certain steps to help expedite and modernize their RFP process. To help you form a better recordkeeper RFP process, here are five ways you can modernize your next RFP.
Source: Fi360.com, May 2020
Retirement specialist advisers are helping plan sponsors make tough choices about plan designs, especially the expansion of loan and hardship withdrawal provisions now permitted under the CARES Act. Such work is certainly building loyalty and goodwill among the client base, sources agree, but it is also important for firm leaders to step back from these efforts to take stock of how this situation is affecting their businesses. Not only is this prudent from a client service perspective, but it also can help staff gain an important piece of mind during an incredibly stressful time.
Source: Planadviser.com, April 2020
This list is specially designed to help you increase your local authority as a retirement plan professional and to attract new plan sponsor clients.
Source: 401k-marketing.com, March 2020
The SECURE Act is not only the first major retirement legislation signed into law by Congress in the past decade, it is also a powerful opportunity for retirement plan advisers to educate plan sponsors on the annuity provisions of the legislation. RPAs should embrace the extra responsibility of making sure employers are educated about the overall restrictions and benefits of annuities and actively help them evaluate the best one for the company's plan.
Source: Investmentnews.com (registration may be required), January 2020
There are roughly eight million small businesses with employees in the United States. The Investment Company Institute reports that there are 555,000 401k plans in the U.S. as of June 2019. That leaves a lot of opportunity for both advisers and the retirement industry, overall. That opportunity may be realized by proactively offering 401k alternatives to these small businesses. Establishing business relationships with companies that may be interested in a SIMPLE, SEP or payroll deducted IRA may create openings down the road for 401k plans, financial planning, risk management, business planning, and other services.
Source: Planadviser.com, December 2019
As retirement plan providers grapple with ever-increasing fee pressure, they also contend with evolving expectations from plan sponsors and participants for better, faster, and more comprehensive service offerings. According to findings from The Cerulli Report-U.S. Retirement Markets 2019, maintaining profitability while meeting these expectations will require firms to achieve economies of scale and prioritize technology initiatives.
Source: Cerulli.com, December 2019
Despite fee compression, some retirement plan advisers have begun pushing back, pointing out to clients all of the value they bring to retirement plans and, in some cases, negotiating slightly higher fees for the work they do. One adviser charges a flat fee up to certain asset levels, and then additional basis points as plans grow, while another emphasizes the detailed, time-intensive fiduciary work he does for clients when asking for a fee increase.
Source: Planadviser.com, October 2019
With demand growing for large, profitable retirement plan advisory practices as defined-contribution plans and retirement take center stage, more advisers than ever are considering selling. When asked what drives value for retirement plan practices, Dick Darian, CEO of consulting firm Wise Rhino Group, replied: "Financials, financials, financials."
Source: Investmentnews.com (registration may be required), September 2019
Most retirement plan advisers work with dozens of recordkeepers because it's easier not to force new clients to change their 401k recordkeeper when the plan adviser is hired. But it's hard for plan advisers to manage working with so many providers. While consolidating their provider roster makes sense, the reality is that few advisers are taking major steps in that direction for practical reasons, and even fewer recordkeepers are focused on helping.
Source: Investmentnews.com (registration may be required), August 2019
This convergence, which sees wealth managers do more business with 401k plans and participants, and 401k advisers do more wealth management for individual clients, is occurring as firms see the need to diversify revenue streams and cater to client demand.
Source: Investmentnews.com (registration may be required), July 2019
Think about restaurant wine lists. If the cheaper wines are listed first, the better wines seem expensive. Switch the order and the perception changes. So how can retirement plan advisers apply this wisdom? First, advisers should offer at least two tiers of services. Starting with the more expensive service will make the lower-tiered service seem very reasonable without making the higher-level service expensive.
Source: Investmentnews.com (registration may be required), June 2019
Retirement plan advisers with established 401k businesses are finding new revenue streams and client engagement opportunities among nonprofits and educational institutions, and in the area of estate planning.
Source: Planadviser.com, May 2019
In the marketplace, it's normal -- even expected -- that firms extend more favorable terms and/or discounts to those who do business with them across various offerings. But those "normal" practices can cause you trouble when it comes to doing business with ERISA-governed plans.
Source: Ntsa-net.org, May 2019
The employee benefits marketplace continues to evolve, with medical and retirement products continuing to merge. This trend is fantastic for the end consumer. But what is the best way for retirement plan advisers to partner with a benefits broker to serve a mutual client?
Source: Investmentnews.com (registration may be required), March 2019
It's always unpleasant when a TPA gets a call or a letter from the Department of Labor (DOL) about an investigation of a client's qualified plan. What should a TPA do? As a first step, a TPA should notify its client about the inquiry from the DOL, so that the client can, if desired, relay that information to its attorney.
Source: Asppa.org, December 2018
There is a sea change underway in the retirement industry. As many as five different generations are now participating in retirement plans. New technologies are emerging to engage participants and streamline back-office operations. All the while, the regulatory environment continues to shift with new and proposed rules. Amidst dramatic change lies unprecedented opportunity.
Source: Broadridge.com, December 2018
Cogent Reports' latest analysis of the DC plan adviser industry shows most advisers touching this space still manage only a handful of plans, while those with more plans are growing much faster than the average firm.
Source: Planadviser.com, November 2018
Across the financial services industry, women are commanding a greater role in key decisionmaking. Where do today's recordkeepers stand in that context? What are today's trends, and where is the industry headed tomorrow?
Source: Asppa.org, October 2018
One of the trickiest areas of compliance for advisers and their supervising firms is related to principal transactions. David Kaleda, a principal in the Groom's Fiduciary & Plan Governance practice, provides an overview of compliance obligations for advisers in connection with principal transactions.
Source: Groom.com, August 2018
The 2018 RIA Benchmarking Study by Charles Schwab is the leading study of its kind in the RIA industry. The Study features insights based on self-reported information on topics such as asset and revenue growth, sources of new clients, products and pricing, staffing, compensation, marketing, technology, and financial performance.
Source: Aboutschwab.com, July 2018
If you talk to any marketing consultant, one of the top things they bring up is having a value proposition. Retirement plan advisers' most frequent value proposition centers around the investment review process. But there's a big issue with that: It isn't really what plan sponsors value or why they hire an adviser.
Source: Investmentnews.com (registration may be required), June 2018
Third-party administrators have been in the spotlight following a string of recent acquisitions, and retirement plan advisers should take note. TPAs have been getting more attention largely because of an aggressive roll-up strategy being executed by the private-equity backed firm Ascensus.
Source: Investmentnews.com (registration may be required), June 2018
The focus on compliance obscures the compelling business case that fiduciary conduct (1) is what clients want, (2) is operationally efficient and reliable, (3) strengthens client-adviser relationships and makes them more enduring, (4) provides the adviser with greater pricing power, and (5) enhances the advisory firm's brand and market valuation.
Source: Investmentnews.com (registration may be required), February 2018
As we enter 2018, the adviser-sold 401k market begins its next phase of development. No longer an awkward, energetic teenager, the market is entering early adulthood, bringing with it heightened responsibilities, greater scrutiny and more opportunities, for some.
Source: Investmentnews.com (registration may be required), December 2017
This article examines the manner in which the fiduciary rule, and in particular the BIC Exemption, affect business best practices regardless of whether any changes are made to the fiduciary rule and related exemptions.
Source: Wagnerlawgroup.com, October 2017
Regulators want to ensure advisors safeguard client and business information online. Implement these best practices to reduce the risk of your data being compromised.
Source: Morningstar.com, September 2017
As with other service providers to defined contribution plans, price compression for adviser services has been rapid and deep. Price compression in the retirement plan arena isn't new, but it's gotten to a point where observers believe advisers could be in trouble? absent some sort of change
Source: Investmentnews.com (registration may be required), September 2017
The retirement plan business is relationship-based. A recent survey found that 7 out of 10 plan sponsors were introduced through a trusted relationship. Therefore, by strengthening your relationship muscles, you can boost your 401k referrals and favorable introductions.
Source: Napa-net.org, July 2017
With the growing 3(38) role, competition is naturally increasing and 3(38) fiduciaries are looking for ways to distinguish their services. A largely overlooked opportunity in differentiating services is choosing to incorporate plan menu design into one's value proposition.
Source: 401ktv.com, July 2017
As a business owner and retirement plan advisor, you understand the fiduciary process of organizing, formalizing, implementing, and monitoring. Now, it's time to take the same approach to constructively evaluating your brand. Professional branding could be the differentiator needed to demonstrate your experience to increase your retirement plan business.
Source: 401k-marketing.com, April 2017
In today's dynamic multi-media world, your plan sponsor prospects search for information in a variety of ways. They seek information on their phones, Google, newsletters, seminars, webinars, emails, blog articles, LinkedIn, Facebook, YouTube, et al. That's why it is important to be where your prospects, clients, and centers of influence are searching for information.
Source: 401k-marketing.com, April 2017
The Colorado Division of Securities recently proposed two new rules that would require investment adviser firms and broker-dealers to assess cybersecurity risks and implement written policies and procedures "reasonably designed to ensure cybersecurity."
Source: Ria-compliance-consultants.com, April 2017
There's a clear need to increase awareness about litigation risk and to understand the key issues that have made their way to the highest courts. These decisions have implications for 401k retirement plan advisors, plan sponsors and other plan fiduciaries alike. Recent decisions should help shape compliance strategies for those responsible for managing defined contribution plans.
Source: 401kspecialistmag.com, April 2017
Cost advantages and growing regulatory compliance requirements are making Collective Investment Trusts an important investment vehicle in the DC market. The characteristics that differentiated CITs from mutual funds are becoming competitive advantages, and their place in the retirement market is expanding to include even small players. This 28-page white paper can help you understand the increased opportunities CITs present to asset managers seeking a larger share of retirement assets.
Source: ALPS, March 2017
This 9-page research paper explores the DOL fiduciary ruling's impact on the DC market. The paper begins by looking at how DC advisors see the ruling changing their businesses and how it's shifting their priorities. Then it turns to the participant view, examining their awareness of the ruling and how it alters their perceptions of financial advisors and the industry overall. Then, it looks at DC advisor satisfaction with the support they are receiving from financial providers.
Source: Marketstrategies.com, February 2017
The SEC's Office of Compliance Inspections and Examinations published its examination priorities for 2017 for broker-dealers and investment advisers. The priorities generally reflect practices, products, and services that OCIE believes may present heightened risk to investors and to the integrity of the US capital markets. OCIE's 2017 priorities cover three broad areas.
Source: Practicallaw.com, January 2017
With heightened regulatory scrutiny, greater frequency of data breaches, and high-profile incidents of hacks pervasive in the daily news cycle, advisory firms have sharply increased their focus on cybersecurity. While the risk can't be eliminated, steps to raise awareness, adhere to best practices and have a detailed plan can help protect a firm and its clients.
Source: Investmentnews.com (registration may be required), January 2017
While the SEC proposed Rule 206(4)-4 has not yet been adopted, RIAs should nonetheless review their business continuity and disaster recovery plans and ensure that they address many of the issues identified in the proposal, which are reviewed here, and incorporate certain best practices so that they are better positioned to respond to and recover from significant business disruption events.
Source: Alston.com, January 2017
In the success of your firm, equally important to free cash flow, is the people. You need to make sure you have the right people on your team. This article reviews a number of best practices when hiring and managing your staff.
Source: Planadviser.com, December 2016
How can your firm protect itself from the growing number of cyber threats? It starts with exercising some online common sense. Here a few considerations to evaluate your company's security practices and processes.
Source: fi360.com, October 2016
State and federal regulators cite an adviser's fiduciary obligation to protect clients' interests from being placed at risk as the basis for requiring business continuity plans. However, the SEC's justification for the proposed rule leaps beyond core fiduciary principles. Instead, the regulator seeks to assert that an adviser's failure to provide a viable BCP would be subject to anti-fraud provisions of federal securities laws.
Source: Investmentnews.com (registration may be required), September 2016
Historically, recordkeepers, not TPAs, have held a leadership position in technology deliverables that are provided to plan sponsors, participants, and advisors. Today, however, there is a growing reliance on TPAs to deliver more technology-driven solutions that enhance an advisor's ability to win new clients and keep existing ones.
Source: Asppa-net.org, August 2016
The advisor will become the plan sponsor's go-to resource for all things plan-related if he or she believes the advisor understands the company's plan and has the knowledge to troubleshoot plan problems. Consider these best practices to ensure that you remain the go-to resource.
Source: Sourcemedia.com, July 2016
Independent financial advisory firms reported that they have maintained a ten-year growth trajectory despite numerous and varied investment environments, according to results from Schwab's 2016 RIA Benchmarking Study. The Study underscores the critical importance of the advisor/client relationship as the bedrock of firms' strength and resilience, and as a driver of growth.
Source: Schwab.com, July 2016
In recent weeks, much of the discussion around a recent Supreme Court case, Gobeille, has focused on ERISA preemption. But for fiduciaries of benefit plans the case can serve as a reminder of important duties that often go unexplored: protecting the private data of participants. Article reviews a number of practical steps that plan sponsors and other fiduciaries can take in the hope of preventing problems.
Source: Benefitslawadvisor.com, April 2016
A recent announcement by the ERISA Advisory Council that it will be focusing on how cyber-related threats affect TPAs is addressed in a recent legal advisory from Pillsbury Law.
Source: Asppa.org, April 2016
It may have been primarily directed at investment advisors, but plan administrators need to understand what it means and how they will be affected as well. Craig Hoffman, general counsel for the American Retirement Association, and David Schultz, attorney and product manager for FIS Relius Wealth & Retirement, summarized the salient provisions of the final rule and the related prohibited transaction exemptions.
Source: Asppa.org, April 2016
Dual registration and hybrid models have become increasingly popular because they have a great deal of flexibility in serving client needs. This 12-page paper takes a close look at some of the unique concerns confronting the growing number of individuals and firms that have adopted dual registration or hybrid approaches to serving client needs.
Source: Pershing.com, March 2016
While the outcomes of the Dodd-Frank mandate and the DOL's proposal remain uncertain, for the foreseeable future, broker-dealer firms are likely to experience increasing pressure to demonstrate that they have policies and procedures that identify and prevent conflicts of interest. This 8-page paper discusses some of the common broker-dealer practices that the authors believe to be potential conflicts.
Source: Pershing.com, March 2016
This 28-page survey report finds that plan sponsors prefer to work with plan advisors who emphasize employee education, good customer service and reducing plan costs as core to their value proposition. Among those already working with an advisor, fiduciary support trumps cost on this list.
Source: Massmutual.com, January 2016
An 8-page Cogent research paper that reviews the attributes that most influence retirement plan advisors' likelihood to recommend a DC investment manager and the aspects that strengthen relationships by building loyalty.
Source: Marketstrategies.com (registration may be required), January 2016
Continuing to deliver on its promise to focus on 401k plans and IRAs under its ReTIRE (Retirement Targeted Reviews and Examinations Initiatives) program, the SEC is focusing examinations on retirement advisors.
Source: Napa-net.org, January 2016
A recent Securities and Exchange Commission exam sweep of investment advisor and mutual fund complexes' distribution fees, including 12b-1 fees, has prompted SEC staff to issue guidance warning advisors and boards to pay closer attention to such fees.
Source: Thinkadvisor.com, January 2016
401khelpcenter.com, LLC is not the author of the material referenced in this digest unless specifically noted. The material referenced was created, published, maintained, or otherwise posted by institutions or organizations independent of 401khelpcenter.com, LLC. 401khelpcenter.com, LLC does not endorse, approve, certify, or control this material and does not guarantee or assume responsibility for the accuracy, completeness, efficacy, or timeliness of the material. Use of any information obtained from this material is voluntary, and reliance on it should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. Reference to any specific commercial product, process, or service by trade name, trademark, service mark, manufacturer, or otherwise does not constitute or imply endorsement, recommendation, or favoring by 401khelpcenter.com, LLC.