Back to school: Top tips for 403(b) and 457 advisers

A question often heard from financial advisers is, “How can I help the teachers in my town with their retirement needs?” The answer is not always a simple one.

Due to a combination of school policies, child safety concerns and often mistaken views related to 403(b) plans (often referred to as the “401(k) plans for educators”), connecting with educators and school officials in the K-12 space to discuss retirement benefits has become increasingly difficult. Even when financial advisers are invited to share their available services with local school employees, those advisers sometimes find that the school district does not have an approved 403(b) provider who will accept business through independent financial advisers.

Fortunately, there are retirement management providers that specialize in delivering specifically-tailored products for advisers to offer K-12 school employees. To do business in K-12, advisers must check with school districts to see who the providers are or partner with a company offering an established 403(b) business in K-12 to find available districts.

Financial advisers looking for a 403(b) provider that suits their business should consider:


  1. Will the provider allow independent financial advisers to offer their products? Many providers only distribute their products through proprietary agents. These companies often offer fixed or variable annuity products with limited investment choices. A few more progressive companies offer “open” arrangements whereby any adviser can represent products with a broader range of choices.
  2. Is the provider’s investment menu limited to only a handful of proprietary funds or does the provider offer more of an “open architecture” menu of investments? There are only a handful of true open architecture products available in 403(b). There are far fewer when looking just at the K-12 segment of the 403(b) market. Open architecture providers are harder to find, but they are out there.
  3. Does the provider support independent financial advisers with specialized materials to explain the 403(b) and K-12 offerings? Companies committed to the K-12 market will offer K-12 specific marketing collateral that can be co-branded for an adviser’s business.
  4. Will the provider help identify districts where the adviser can begin working immediately? Advisers should ask providers for a list of nearby school districts or national lists to discover where these companies do business and where they will allow advisers to represent their products. 


There has never been a better time for qualified financial advisers to help America’s educators save for their futures. America’s educators need help. The financial strength of the defined benefit plans that they rely on for the balance of their post-employment income are increasingly coming into question. Advisers have an opportunity to help teachers and public school employees help themselves save for a better future despite uncertainty.

While it’s not easy to gain access to educators and find the best companies with whom to do business, making the effort not only helps these important clients, but also an adviser’s own business. Furthermore, when serviced well, teachers are some of the most loyal clients who are quick to tell co-workers about good service and people who care about them.

Advisers are wise to find out who a district’s 403(b) companies are by calling the payroll office and contacting district officials or school principals to find out how to best serve the school employees. With a little persistence and a willingness to help America’s educators, financial advisers who make the effort will find themselves with new business opportunities and some of the most loyal and appreciative clients anywhere. 

Mark Luckinbill, Head of 403(b) and 457 Markets, Aspire Financial Services
NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.