15th Anniversary of RPAY: Josh Ulmer

His practice has a nine-step strategy for how retirement plan advisers can improve the health of defined contribution plans and the retirement outlook for participants.

Josh Ulmer

Josh Ulmer of the SeaPort Group at Morgan Stanley says that since he was named the 2017 PLANSPONSOR Retirement Plan Adviser of the Year (RPAY), “the industry has become smaller through the consolidation of recordkeepers and plan advisers, and with that increased competition comes better services and pricing for plan participants and sponsors.”

He adds that “it has become more challenging for plan advisers to differentiate themselves, and it requires us to offer more services.”

Despite these challenges, he says the SeaPort Group at Morgan Stanley has nearly doubled its assets under advisement (AUA) in the past three years, from just over $1 billion to $2 billion, while the number of plans it serves has risen from 35 to 55 today, Ulmer notes.

What has not changed is the group’s service model. Ulmer is the adviser at the practice, supported by five specialists in a vertical team structure: a practice leader, relationship manager, investment advisory specialist, investment analyst and investment reporting associate. Morgan Stanley provides the back office administration and operational support, Ulmer notes.

“We have found this the best structure to deliver services to clients, allowing us to focus on providing best-in-class advisory services to defined contribution [DC] plans,” he says. “This structure allows us to spend a lot of time evaluating the business strategy and the services we deliver to drive successful outcomes, as well as ensuring we consistently deliver a high level of service and execution. The model works great and is, certainly, something I intend to stick with.”

Ulmer says he is very optimistic about the future of the retirement planning industry. “Specialists who can prove their worth and provide clients with an understanding of the value they bring will always have a place in the market,” Ulmer says, adding he believes that advisers who can offer customized solutions will especially have a bright future.

Ulmer is also hopeful that pooled employer plans (PEPs) will catch on at the lower end of the market to improve retirement plan access.

Ulmer says he does not think that holistic financial wellness is more important today than it was three years ago. Rather, he argues that it has always been important.

What has changed is that there is a greater awareness among sponsors of the importance “of getting employees into the retirement plan and on track for a successful retirement,” he says. “They are now taking a broader view of just saving for retirement and auto-enrollment features to meet their employees wherever they are on their financial journey. A successful and holistic financial wellness offering must cover every aspect of someone’s financial journey, including student loan debt, college savings, medical expenses and saving for a home, to mention just a few. What is different today is that advisers are using technology to deliver this in scale.”

Since the pandemic hit the United States last March, the SeaPort Group has urged its plan sponsor clients “to step up their communication and messaging efforts to employees, especially on financial wellness fundamentals,” Ulmer says. “We have been urging participants to stay the course. We know that periods of volatility can lead to damaging decisions and suboptimal behavior.”

The practice made it a point to explain to its plan sponsor clients the Setting Every Community Up for Retirement Enhancement (SECURE) Act and the Coronavirus Aid, Relief and Economic Security (CARES) Act, Ulmer says. The SeaPort Group also prioritized ensuring that the recordkeepers it works with could comply with the new laws, he says.

As to how retirement plan advisers can improve the health of DC plans and outcomes for participants, Ulmer lists nine things that advisers need to concentrate on.

“First, they need to fully understand plan design, administration and compliance,” Ulmer says. “Having technical knowledge is incredibly important to be a successful adviser and to improve the health of defined contribution plans and participants.

“Second, they need to understand the demographics of the plans they serve,” Ulmer continues. “They need to take the time to get under the hood and have conversations with human resources [HR] so they understand plan participant characteristics. That will guide how they use automatic features and can customize them around each sponsors’ retirement readiness goals.”

Next, he says advisers need to offer a holistic financial wellness program that has a robust infrastructure in place in order to deliver it.

“Fourth, they need to remain current on the legislative and regulatory front, fully up to date on provisions that impact plans.

“Fifth, they need to revisit plan success measures every year to see what progress is being made and continuously move the bar higher and higher,” he says.

Next, Ulmer suggests that advisers fully familiarize themselves with the offerings of recordkeepers, third-party administrators (TPAs) and investment managers.

Ulmer says he believes that each advisory practice should be able to conduct proprietary investment analysis, and that they should charge reasonable fees that are benchmarked regularly. Finally, Ulmer says advisers should “work with the client to have them adopt the right fiduciary service level for their plan.”