In Practice September 22, 2011

Opportunities Abound for TPAs in 403(b) Marketplace

Third-party administrators (TPAs) are playing an increasingly important role in the 403(b) market segment, notes an Issue Brief by Retirement Research Inc.
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Under new regulations, employers assume a more active role monitoring and managing their plans. With new administrative duties and a trend toward vendor consolidation, TPAs and advisers to 403(b) plans will likely be asked to help sponsors search for providers.  

RRI cited an ASPPA survey of third party administrators, conducted in 2010 by Brightwork Partners, that suggested 403(b) plan administration could be a major growth focus for TPAs in the next two to three years (see “TPAs Expect Major Growth Opportunity in 403(b) Market“). TPAs currently collaborate with plan sponsor’s existing 403(b) vendors/providers; they typically provide administrative, compliance, and communication services, including all important data aggregation and legacy asset tracking.  

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RRI contends that as compliance and data collection get more complex, both providers and sponsors are looking to TPAs for help with participant recordkeeping, prototype plan documents, summary plan descriptions, nondiscrimination testing, Form 5500 preparation, Web-based transactions, loan processing, and hardship determination. TPAs can offer these services on either a fully unbundled or TPA interface basis.  

Additionally, common Remitter platforms were created by some TPAs and service providers to service the growing number of Employee Retirement Income Security Act (ERISA) 403(b) plans.  

A full report can be purchased here.
Products September 22, 2011

Putnam Creates Adviser-Dedicated Web Site

Putnam Investments has launched a Web site dedicated to helping advisers better serve their clients.  
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Putnam said the new site (www.putnam.com/advisor) was developed in alignment with its strategy of continuing to expand its web-based technologies to help financial advisers and their clients achieve their financial goals.

“We want to provide advisers with an intuitive, yet highly sophisticated set of customized resources that dynamically integrates and presents data, analysis, and thought leadership,” said Bill Connolly, Head of Global Distribution, Putnam Investments.

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The Putnam adviser site builds upon the company’s analytical tool, FundVisualizer, which provides portfolio modeling and side-by-side comparisons of multiple products. On the new site, FundVisualizer can now model entire investment portfolios from a universe of over 11,000 mutual funds and exchange-traded funds (ETFs), as well as provide head-to-head product comparisons.

With the updated version of Putnam FundVisualizer, advisers can choose and package an unlimited number of potential fund holdings, assign specific weightings, and adjust time periods as desired, in order to gain insight into the performance behavior and risk-return trade-offs of customized portfolios and their underlying components. Additionally, advisers can compare separately created portfolios of their own design. The portfolios can utilize Putnam or non-Putnam product solutions.        

Along with portfolio modeling capabilities, the new Putnam site will allow the adviser community to join conversations on Putnam’s social media sites, including those on Twitter (http://twitter.com/#!/putnamtoday) and Facebook, (http://www.facebook.com/PutnamInvestments).  A feedback component will also be available to advisers visiting the site will be able to rate content, such as portfolio manager commentary. Also, the Web site will provide advisers with a sense of what their peers are viewing most on the site, including what investment issues and client-related topics are of most interest – displayed through a visual “tag cloud.”   

The Putnam site will also provide advisers with practice management and thought leadership resources to help in their day-to-day and long-term planning work with clients.

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