Plan sponsors are increasingly looking to their plan advisers to offer holistic services and options for their participants—likely the best way to help people truly meet their retirement goals—according to a PLANADVISER Practice Progress webinar held on November 16.

The shift, in many ways, means more work for plan advisers. But developments in technology and know-how can help advisers provide assistance beyond the plan.

“I definitely think, [in] the last three to five years, that plan sponsors are even more open than ever to us doing a variety of education,” said Jessica Ballin, a principal in and investment adviser representative at 401(k) Plan Professionals. “What’s top of mind to these plan sponsor clients is attracting and retaining top talent. … I think we’re going to be seeing more clients improve their benefits, especially in the retirement plan, to be more competitive.”

Ballin noted how the technology and accepted practices of communication that became more prevalent during the COVID-19 pandemic remain helpful options now.

“We’re able to communicate with participants almost more than before through all the variety of channels,” she said.

Sean Bjork, president of Bjork Asset Management, noted that his firm shifted from only working with retirement plan committees to offering financial wellness services to their participant pools. Part of that was a shift in his thinking, but it also stemmed from the acceptance of and desire for it from plan sponsors.

“If I went out six or seven years ago to a [retirement plan committee] and said that we’d like to do a budgeting workshop with your team, they’d say, ‘Hey, Sean, stay in your lane. We’re going to talk about the 401(k), and that’s as far as this goes,’” Bjork said.

Now, committees are far more open to discussions and are “actively looking for” his advisory to bring in financial wellness and education.

Justin Bogart, a retirement plan consultant with SageView Advisory Group, says his firm has been putting forward holistic participant support to clients since its start. Like Bjork, however, he has seen more clients who are looking for help beyond retirement savings.

“Really what it comes down to is that most participants don’t have $1,000 if there’s an emergency, most of them have credit card debt, most of them have student loans,” Bogart said. “They are in a lot of pain financially … and they honestly, really can’t afford to save the amount they need to save to meet their retirement goals.”

Bogart said those “core” issues must be addressed so participants can prepare for retirement in the right way.

“If you can’t have honest conversations about that, then just teaching somebody to put 10% in their retirement plan and put it into a target-date fund is really just a waste of everybody’s time,” he said.

Ballin noted that when an adviser becomes a “trusted resource,” it is more likely they will reach out when they have problems or need advice. That holds true not just for low-income earners, she said, but those same questions can come from C-suite executives.

Tools & Resources

Adviser Bjork says his firm has tried many different tools and offerings to engage and provide education for participants. A key challenge remains finding “one-to-many” outreach that does not stress already overworked HR teams.

One helpful tool is video that can be accessed by many people and watched on demand. Another is an email system that will track engagement and uptake, along with a calendar booking system via which participants can easily schedule a one-on-one session with an adviser.

“That’s been really powerful to help scale some of this,” Bjork says. “It is a little daunting [for an adviser] to think, ‘Hey, I want to now begin educating and having a more direct and meaningful relationship with 10,000 people. Having the technology to do that in a scalable way is certainly something that helps.”

Ballin agreed that HR departments are often pressed for time. Her firm looks to alleviate that by providing all the materials participants need in one easily transmittable format.

“We try to make it as easy as possible,” she said. “Everything is done—they just forward it. It’s not like the past, where you used to have to book a conference room or have a sign-up sheet or all of those things that could be difficult to set up.”

Product Solutions

Beyond participant outreach, the retirement industry has been conceiving product offerings to get more “personal” advice and investment to large groups of participants.

When it comes to options such as managed accounts or embedded retirement income solutions, the advisers expressed a general sense of interest, but not an impending likelihood of implementation.

“I said we’re early-innings in terms of participant services; we’re still in batting practice in managed accounts,” Bjork said. “I think, intuitively, the ability to further customize a participant’s glide slope based on a handful of additional data points that are readily available from payroll and recordkeeper platforms is a no-brainer … but the devil is in the details in terms of the fee structures, who is capturing what and whether it’s a differentiated experience.”

Bjork says his firm is not “there yet” in terms of implementation, but it is getting more comfortable with the idea. He said he feels similarly about in-plan retirement income options, which make sense in terms of solving for the “decumulation” phase but are not yet at the point where he is ready to suggest them to clients.

Bogart said that at SageView, advisers will consider a managed account if it is right for the client. That will depend on the situation and participant pool, as while managed accounts have advanced, “they are not right for every situation.”

When it comes to retirement income, Bogart said he sees momentum building for new solutions.

“I think what you are really going to start to see is income, managed accounts and target-date funds coming together over the next year, where it comes together as a kind of package deal,” he says. “There will be the right ones and wrong ones for clients, but I think that’s going to be pretty common if we look back 10 years from now.”

You can watch the full webinar, including discussion of the wealth management connection to participant advice, on PLANADVISER’s website: PLANADVISER Webinar – Zoom.