PANC 2018: The Value of an Adviser—Plan Sponsors Tell All

Sponsors expect their advisers to be proactive and to push their plans to the next level.

“The conversations we have with our retirement plan adviser are always about getting the plan to a better place,” said Joanna Farrere, senior vice president, human resources and administrative services at the Illinois Health and Hospital Association.

Farrere was speaking on “The Value of an Adviser—Plan Sponsors Tell All” panel at the 2018 PLANADVISER National Conference. She was invited to speak, as the Illinois Health and Hospital Association was selected as the 2018 Plan Sponsor of the Year in the non-profit defined contribution category for plans with less than $100 million in assets.

Heather Masterson, human resources director at Hendrick Motorsports, which also won 2018 Plan Sponsor of the Year, in the corporate $50 million to $100 million category, said she is constantly receiving solicitation calls from recordkeepers and advisers. “There is a tremendous amount of interest in doing business with us,” she said. “We are constantly receiving requests to connect on LinkedIn. It can be overwhelming at times.”

Asked whether she would consider those solicitations, Masterson said, “It is all about the personality. If they make a concerted effort to know the plan or to tell me they can offer a second set of eyes to examine it,” she will consider hearing them out. “It is all about building a relationship with us.”

Farrere agreed: “Do they know who they are calling and have they reviewed all the publicly available information? Are they offering to provide me valuable information, such as a white paper they have produced, or to tell me about a new regulation that was passed?”

As to what Farrere expects from her retirement plan adviser, it is to be “a trusted source, really pushing me forward to think about new strategies and to keep our team—the recordkeeper, the committee and the auditor on the plan—together. We have weekly conversations with them about what we should be doing.”

In the case of Hendrick Motorsports, the retirement plan adviser is not the point person but part of the recordkeeper and committee team, Masterson said. “The adviser complements me very well and is extremely knowledgeable about leading trends, such as 90/10/90 [90% participation, 10% deferral rate and 90% of participants invested in a target-date fund or other balanced fund]. Our committee is asking us what we can do next, and we rely on the adviser for that.”

Farrere agreed that insights from her adviser are very helpful. For example, the adviser works with the recordkeeper and other providers to ensure that fees are reasonable, vets new options and tells Illinois Health and Hospital Association what other clients are doing. “It helps us navigate,” she said.

Winning the 2018 Plan Sponsor of the Year award has inspired Hendrick Motorsports “to look at a broader time horizon to get things done,” Masterson said. “We now have a three-year plan, and the adviser helps us prioritize all of the things on our mind. We are a high-maintenance plan and need the adviser to be flexible and agile.”

Farrere said the Illinois Health and Hospital Association especially appreciates its adviser’s recommendation to automate enrollment and escalation. “Plan design, along with education, is very important,” she said.