Products September 19, 2016

Fiduciary Training from fi360 Considers DOL Shift

Multiple broker/dealers are gaining access to fi360’s Fiduciary Essentials for Advisors program.
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Fiduciary-related education services provider fi360 revealed a new program called Fiduciary Essentials for Advisors (FEA), designed to provide timely training to assist financial professionals as they respond to the Department of Labor’s (DOL) new conflict of interest regulation.

The firm says the FEA program is a “self-paced online program that provides a foundation of fiduciary education.” The program focuses on the fiduciary roles and responsibilities of advisers managing qualified retirement plan programs and individual retirement accounts.

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Divided into five modules that cover a range of fiduciary-related themes, advisers will come away from the FEA training with a better understanding of the obligations under today’s regulatory environment, the specific requirements of the DOL’s conflict of interest rule and how to adopt fi360’s fiduciary best practices. (See “Fiduciary Rule Aftermath for RIAs” and ”Fiduciary Rule Aftermath for Non-RIAs”.)

“In terms of application, participants will be taught how to make investment decisions that are in the best interest of clients, as well as receive training on retirement plans and services,” the firm adds.  

“We’ve been developing fiduciary practices and training advisors since 1999. Finalization of the DOL fiduciary rule has created unprecedented demand for our services, and we’re thrilled to offer firms our Fiduciary Essentials for Advisors program,” says John Faustino, chief product and strategy officer at fi360.

Learn more at www.fi360.com.  

Client Service September 16, 2016

PANC 2016: Next Generation Plan Design

Advisers can encourage plan sponsors to move beyond auto-enrollment.
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The Pension Protection Act (PPA) provided big drivers to improving defined contribution (DC) plan participant outcomes, Brian A. Catanella, institutional consultant and senior retirement plan consultant with UBS Institutional Consulting Group, told attendees at the 2016 PLANADVISER National Conference in Orlando.

Automatic enrollment and automatic deferral escalation increased participation and savings rates, and qualified default investment alternative (QDIA) rules shifted employees to more age- and risk-appropriate investments.

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But, plan sponsors are eager for advisers who can look at their plans and help them make these plans more efficient and effective, he said. They want specialists. “They have a fear of litigation, and they want help managing their fiduciary responsibilities,” Catanella said. “In addition, they want to keep costs down, and need education about how they are paying plan fees.” He added that revenue-sharing is not always a bad thing if it provides enough to pay a large part of plan fees.

As far as plan design, convincing plan sponsors to implement auto-escalation is a delicate conversation, according to Catanella. But he says, using data, advisers can make a good case to plan sponsors. “Provide projections of the improvement in participants’ savings and retirement readiness,” he suggested. “Also, point out the costs of employees not being able to retire.”

For plan sponsors concerned about the costs of auto-escalation, one thing to consider is stretching the match. Participants save more and the employer match costs remain the same.

Catanella also said encouraging plan sponsors to do a re-enrollment of all eligible employees is important. Advisers can point out that it could increase participation of non-highly compensated participants, and may help with nondiscrimination testing.

He said getting plan sponsors to measure retirement readiness of employees and providing a savings gap analysis to employees can also drive plan design decisions.

According to Catanella, advisers should encourage plan sponsors to offer overall financial wellness solutions to employees. “It is especially good to help low earners,” he said. “There are lots of vendors that can help with this.”

Finally, Catanella suggested introducing plan sponsors to certain technology, especially to get younger employees more engaged. Providers have been innovative with smartphone applications. “It would be good to find an app that shows all of a participant’s financial components at once,” he said.

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