Kevin Bishopp, Russell Investments’ director of Advisor Growth Strategies, spoke with PLANADVISER about several situations in which advisers are better off just saying no.
If a Client Does Not Take Interest
A plan adviser should be wary of a plan sponsor who does not communicate effectively with participants and does not take a real interest in the retirement plan. “It might be another piece of business, but there may not be a good brand,” Bishopp said. “It’s not going to help your business long term.”
A plan adviser should be able to gauge quickly whether a plan sponsor is a good fit. Particularly during the request for proposal (RFP) process, advisers will discover a plan sponsor’s attitude toward offering a benefit to participants, and whether the retirement plan is a priority.
Bishopp suggested advisers contemplate the employees’ attitudes toward the plan sponsor as it relates to the plan. Is it mistrust or skepticism? If so, perhaps the plan sponsor is not the right fit for the adviser.
If a Client Does Not Take Advice
If a client is paying for advice they are not taking, it puts both the client and adviser in a bad position—the client is not using services he is paying for, and the adviser is suggesting recommendations the client is not taking.
The adviser should first try explaining his role to the client, but if the client remains unreceptive, Bishopp said it is probably time to suggest the client find another adviser. This way, the adviser can alleviate the risk of having a client who does not accept his advice.
If Participants Want One-On-One Advice
In larger companies, Bishopp suggested advisers decline meeting with participants on an individual level because meeting with so many participants can be challenging, or even impossible. It can also detract from the adviser’s relationship with the plan sponsor.
The adviser should still coordinate enrollment meetings, but one-on-one meetings should only be reserved for the plan sponsor, he said. In addition, serving participants one on one in a larger company can also detract from the adviser’s ability to prospect new clients because of the time it takes.