Ameritas Teams with National Financial

Ameritas Investment Corp. has selected National Financial to serve as the sole clearing and custody provider for its broker/dealer brokerage services.

The subsidiary of Ameritas Life Insurance Corp. said in a release that it is embarking on a straight-through processing business environment that is designed to help customers, advisers and the core business by using the technologies made available by National Financial.

The partnership allows Ameritas Investment to use National Financial’s advanced technology tools, said Salene Hitchcock-Gear, president and chief executive of Ameritas Investment Corp. “What we will offer through this strategic alliance is an easier way to do business,” Hitchcock-Gear said. “We believe our advisers will have the tools they need to further enhance their customer relationships. The technology now available is designed to simplify their business practices, and these efficiencies will allow our advisers to spend additional time where it is more valued.”

Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.

The National Financial technology platform meets the varying needs of a diverse set of financial professionals, including registered investment advisers, broker/dealer home offices and financial advisers. The platform in a mobile setting affords users easy operation, giving access to information wherever they are.

 “This change is exciting,” said Darla Wilton, vice president and chief administration officer at Ameritas Investment Corp. “Straight-through processing is greatly impacting our industry and it’s going to transform who we are. We believe it’s going to change our behaviors and our culture. And it’s going to put Ameritas Investment Corp. ahead of the curve.”

Investor clients will also enjoy potential benefits from the advanced technology because advisers will have the ability to deliver better client services on a faster and improved basis. For clients who are interested, the new environment will also offer them opportunities to have account information, market analytics and research at their fingertips through mobile apps on their smartphones and tablets.

Ameritas Investment Corp. is a privately owned broker/dealer with more than 1,500 registered representatives and financial advisers nationwide.

Passion for the Participant

Many retirement plan participants, especially those with lower incomes, are overwhelmed by projections of how much they need to save, and they feel powerless to do anything about it.

But, George Fraser, managing director, and Sean Ciemiewicz, principal, at Retirement Benefits Group, feel advisers can change this. “It’s not about a jazzy website or the lowest cost funds, it’s about sitting down with participants and showing them their power,” Fraser told attendees of the Plan Sponsor Council of America’s (PSCA’s) 66th Annual Conference in Scottsdale, Arizona.

Fraser contended the current model today lacks results. He noted that the industry has spent millions on websites, call centers and enrollment materials, and 70% to 90% of participants never log on to websites or call in to call centers. In addition, 86% of defined contribution retirement plan participants never rebalance their accounts, only 10% of individuals who qualify for the Internal Revenue Service’s Saver’s Credit take advantage of it, and while 22% of plan sponsors offer Roth after-tax accounts, only 10% of participants use them.

Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.

“We spend a lot of time worrying about costs and the investments offered—and that’s all important stuff—but, we need to focus on changing participant behavior,” Fraser said.

According to Fraser, empowering participants includes helping them take the guesswork out of investing. He contended most are not as bad off as the media hype makes them feel. The unattainable goal that everyone needs one million dollars saved is not true. Someone in an expensive location with no debt could get by with less.

For example, if a participant knows he only needs $1,700 per month in retirement to live the lifestyle he wants, and an adviser explains he will get $1,400 from Social Security and $250 from his retirement plan, he knows he’s only short $50 per month. Explaining to the participant that he can just change to a certain investment or put away another half a percent in deferrals, lets him know this is an attainable goal, Fraser said. The participant feels empowered.

Ciemiewicz noted that research shows advisers make a huge difference, especially if they have one-on-one meetings with participants. He said first advisers must engage participants; they need someone to talk to who isn’t going to try to sell them things. Fraser added that advisers need to make meetings less complicated and relatable; don’t wear a suit or present fancy math.

Ciemiewicz suggested advisers be involved through the employee’s life cycle. When an employee joins a company, he can get transition counseling—direction about how to start saving or how to rollover prior plan money into their new retirement plan. During employment, employees need direction about how to attain their life goals, such as saving for a child’s college education. In the years leading up to retirement, advisers can advise about plan behaviors—how much to save, where to invest and taking advantage of catch-up contributions. Finally, advisers can provide transition counseling to employees who are retiring, answering questions about distribution options.

According to Ciemiewicz, advisers should give participants tools and information such that they will take the right actions, not because an adviser tells them to, but because it is in their best interest. “We all have a moral and ethical responsibility to focus on those who need help,” he said.

«