4 Habits of Successful Plan Advisers

Plan advisers shared habits that have helped advance and grow their practices during a panel at the NAPA 401(k) Summit.

Running a successful retirement plan advisement business has numerous components, including building a book of business, keeping clients happy and setting the firm up for long-term growth.

A group of plan advisers discussed some of their best practices to reach these goals on Tuesday at the National Association of Plan Advisors 401(k) Summit in Nashville. Topics included finding new clients, keeping existing ones, and the power of focus.

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Follow-up

Steve Wilkinson, president, (k)quote, noted that it’s one thing to connect to a client prospect, but he has found the key to moving toward a business relationship is having a process of following up.

“You have to be organized; you have to have a great process,” he said. “When I was cold calling people would say ‘call me two months, call me in three months.’”

Wilkinson had put a system in place to make those follow-ups consistently, which eventually turned them into clients, telling the audience “if you make it a habit to follow-up, that habit will lead to success.”

Karen Casillas, vice president, financial adviser, CAPTRUST Financial Advisors, noted that follow-up isn’t just about prospective clients, but past ones.

“There are a lot of relationships with people you have worked with on a retirement planning committee—whether that’s giving them fiduciary planning, or going through where the plan is, but you’ve built a relationships,” Casillas said. “When these people leave, you can have a follow-up process to continue that relationships, which can lead to business.”

Katie Colon, retirement plan consultant, OneDigital, noted that she takes at least one hour every day on LinkedIn to stay updated on what is happening professionally and personally with clients. Little tidbits about promotions, things they follow, or schools they attended can call lead to “things we can connect on and discuss that makes them want to work with us.”

Empathize

Colon also noted that plan advisers sometimes approach plan sponsors with the idea that the retirement plan is on their mind—often, it isn’t.

“The reality is that retirement often comes last on the list for plan sponsors,” Colon said. “I reach out to start a conversation with them about what they are thinking about.”

Employers, she said, might often be thinking about other areas of their business, such as property and casualty concerns or employee turnover. She said it’s important to first emphasize with those clients on their issues, then consider how retirement might help their situation.

 “You can talk to them about how the retirement plan can help reduce the cost of turnover,” she said.

Wilkinson agreed, noting that it’s important to study a business and approach them with issues they may face in their sector.

“The key is just knowing a bit about them and using their language,” he said. “I learned that it’s not about me and what I’m doing but hearing from them and building relationships.”

Colon noted that she regularly meets with former retirement committee members she has worked with for a coffee or lunch, as oftentimes they will share referrals or leads.

Be Part of the Village

CAPTRUST’s Casillas said it’s important for advisers to remember that “it takes a village” to serve plan sponsors.

“It takes recordkeepers and asset management firms and third-party administrators and ERISA attorneys,” she said. “It takes a lot of work and prep to make sure everyone is aligned when working with the client.”

Casillas noted that her team puts a lot of preparation into ensuring all these parties are aligned before meeting with a client so everything appears seamless on their end. It’s also key, she said, to be responsive and proactive when something along that chain breaks down and a mistake is made.

“As much as I’d love to control everything, mistakes are made, so it’s important to be responsive and let the client know what you are doing to find a solution,” she said.

Casillas also noted that, as a plan adviser, it’s important to be connected to the community in which you do business not just through work, but by engaging in community activities and charitable work.

“Do work for a nonprofit or find some way to give back to the community where you are working,” she said. “That will keep you within the networks that are there.”

Focus

One positive habit the panelists all agreed on was the ability to focus on the important tasks in order to move the business forward.

Wilkinson shared a quote he often uses, which is: “he who chases two rabbits, catches neither.”

“There’s so much opportunity that is out there in the world,” Wilkinson said. “When I was a younger adviser I tried to go after everything. But I’ve learned over time to focus, and I find that, actually, the less I’m doing, the more I’m getting done.”

Colon agreed, noting that a trick she uses is tackling the hardest emails or issues at the start of the day. Even if it means just drafting an email she will send later, it will clear the deck for her to do the outreach and meetings that reap benefits for the business overall.

Casillas agreed, saying that it’s important not to “let email overwhelm you; stick to your plan. If you don’t do that, it can derail a whole day. I think everyone here can relate to that.”

PEP Pros and Cons

A panel of advisers and providers who use PEPs discuss the benefits and potential pitfalls for clients and advisory firms.

Pooled employer plans, introduced in 2019 with the passage of the Setting Every Community Up for Retirement Enhancement Act, are still relatively new to the marketplace.

Because of that, some advisers may not yet offer them to plan sponsors as part of their practice. Should they be doing so? Or is there a risk of putting unnecessary time and effort into the latest “product of the day”?

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The answer, according to a panel of retirement plan advisers and providers who use PEPs, is that an advisory may be at risk if they aren’t at least conversant in the PEP space, and depending on its client pool, have an option on offer.

Phillip Senderowitz, managing director, Strategic Retirement Partners, said PEPs, multi-employer plans, and group of plans are all useful tools in serving smaller plans at scale. The three services, he said, “have been key in marketing more toward the smaller market space.”

Senderowitz noted that, when he initially started working on small plan options, the PEP emerged as a good “turnkey” approach for smaller employers prioritizing ease of use over numerous options.

“When we talked to smaller companies on the startup or small plan side, we say, ‘hey, this is a way you can have a retirement plan without being in the retirement plan business,’” he said.

Even so, the adviser noted that there are many other options for startups and small plans, so group plans should be considered carefully both for the client, and the advisory, particularly in terms of the expected number of adopted plans.

Fiduciary Hand-Off

John Jurik, U.S. practice leader at Gallagher, said the simplicity of a PEP offering, including having in place the recordkeeper, investment lineup, and fiduciary backing, can help a smaller plan sponsor to free up time and resources elsewhere. He noted one client that Gallagher moved into a PEP saved about $30,000 annually, which it then used on a financial wellness option for employees.

“I think it is an opportunity for those plan sponsors to more broadly evaluate their HR strategies,” he said.

Jurik did note that a PEP should not just be sold for cost, but as a way to consider different plan options and provider services as a whole.

Ted Schmelzle, second vice president, retirement plan services at The Standard, agreed that a PEP’s key advantages are not just price point, even though that may have been an early assumption of the product. The real focus on the product in the market today is its ability to provide fiduciary capabilities and administration with one option—as opposed to separate outsourced responsibilities.

“The employers don’t want to be ERISA experts,” he said. “Nobody said, ‘Dave, I’m going to have a qualified retirement plan and the reason is I really want to know the intricacies of ERISA and the pitfalls and all that fun stuff.’”

Different Flavors

The panelists noted that an advisory can offer different “flavors” of PEPs. There can be an option provided through a third-party pooled plan provider, or a PEP setup in-house by an advisory—which may take more time, setup, and learnings.

“It’s important to think about your block of business and what’s the value proposition relative to those employers,” Schmelzle said. “Also, do you have enough scale in order to make it viable? There are a couple of lenses to look at that through, whether it’s the provider that is going to be working with you on the PEP, or whether it’s reaching scale to justify your own cost—those are important questions.”

Senderowitz noted that if an advisory creates a PEP, but cannot populate it with adopting employees, then the pricing advantage will be lost in working with the provider.

“If you cannot populate the PEP, then there’s no point to putting in the time and energy on the front end to set it up,” he said.

Jurik said that, at Gallagher, its leadership team took time to consider whether to include PEPs in their practice after the legislation passed. Once they chose to use PEPs, they didn’t put any mandates around advisers selling them, and there is no special compensation program around them.

The greater advantage to having a PEP, he said, is being able to play “both offense and defense” in this new marketplace.

“As our industry evolves, if you are strictly going to be anti-PEP, then you are doing a disservice to your clients,” he said. “It’s going to be the right fit for some organizations, and it’s not going to be right for others …. But either way, you can be the expert as a true retirement adviser, and you want to take those ideas to your clients before somebody else does.”

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