2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalists

Magazine Article
The Judges

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalists
Select the profile you would like to view from the below list, or click here to begin at the first profile and click through. 

Individuals:
Gregg Andonian- Baystate Fiduciary Advisors Inc.
Steven Glasgow- Avondale Partners LLC
Jeb Graham- CapTrust Advisors LLC
Timothy Pitney- Sapers & Wallack Inc.
Mark D. Ray- Praxis Consulting

Team:
Capital Strategies Investment Group
Everhart Advisors
Graystone Consulting-Cincinnati
Maresh Yoshida 401k Group
Newport Capital Group LLC
The Willhite Institutional Consulting Group

Multioffice Team:
Alliance Benefit Group Financial Services Corp.
Pensionmark Retirement Group
Sheridan Road Financial 

This is the ninth year that PLANSPONSOR has recognized the efforts of the nation’s best retirement plan advisers and the fifth that we have acknowledged the efforts of retirement plan adviser teams. This year, we have added a new category: multioffice team.

For the 2013 list, we clarified the definition of all three categories: An individual adviser is a single adviser with one group of clients; a team is a group of two or more advisers in one office location who collectively serve one group of clients, share relationships and sales, and use the same client support team; a multioffice team is a group of two or more advisers across multiple office locations who share support staff and follow the same guidelines and procedures to serve clients. 

Selecting the advisers that will represent each of these three categories is a painstaking effort, beginning when the nomination process opens, traditionally the day after Labor Day. Nominations are solicited online from retirement plan advisers (self-nominations are, however, not permitted), from their employers and/or broker/dealers, and plan sponsors, as well as from working partners of these advisers, including investment vendors, accountants, attorneys and pension administrators. (continued on next page) 

Once advisers are nominated, they are invited to fill out an online form to enter the judging process. If they meet certain criteria, they can be considered for the PLANADVISER Top 100. However, to be judged for the Retirement Plan Adviser of the Year awards, they are asked to complete a second form, providing various details about their practice and answering essay questions. While it is an honor to be nominated, advisers can only be part of the PLANADVISER Top 100 or eligible for the PLANSPONSOR Retirement Plan Adviser of the Year awards if they take the time to supply the information online. From that group, judges select finalists from each category to compete for that respective award. Those finalists are asked to provide references from clients and peers, and, after background checks and interviews with the judges are completed, a winner is selected.

This year, with the additional category, the selection of the winner has become much more cumbersome. Therefore, as the field has grown increasingly competitive and as the information gathering from advisers takes longer, we are transitioning the announcement of the winners of the PLANSPONSOR Retirement Plan Adviser of the Year in these three categories to the annual PLANADVISER National Conference.

We are honored to play a role in highlighting this year’s finalists and hope you enjoy getting to know them.

The focus of the award has remained relatively consistent over the years—to identify the nation’s best advisers who help make retirement security a reality for workers across the nation. On the pages that follow, we will introduce you briefly to the men and women who were chosen this year who demonstrated the qualities of leadership and commitment to excellence that have been hallmarks of these awards. That commitment is evidenced by the impact these advisers have had on participation rates, deferrals, asset allocation and participants’ better understanding of and appreciation for these programs. It is striking how dedicated they are, as a group, to creative application of the tools embedded in the Pension Protection Act (PPA)—automatic enrollment, accelerated deferrals and asset-allocated funds—and how equally committed they are to helping plan sponsors and participants make thoughtful, prudent choices, sometimes with one-on-one counsel. —Alison Cooke Mintzer

Retirement Plan Adviser of the Year Judges

Lee Barney, PLANADVISER
Stace Hilbrant, 401k Advisors LLC, 2012 PLANSPONSOR Retirement Plan Adviser of the Year
Alison Cooke Mintzer, PLANSPONSOR and PLANADVISER
James Worrell, GPS Investment Advisors, 2011 PLANSPONSOR Retirement Plan Adviser of the Year

Retirement Plan Adviser Team of the Year Judges

Lee Barney, PLANADVISER
Steff Chalk, Fiduciary Consulting and Governance Group Inc.
Phil Fiore, FDG Institutional Consulting Group of UBS, 2011 PLANSPONSOR Retirement Plan Adviser Team of the Year
Matt McLaughlin, Graystone Group Consulting–Danvers, 2012 PLANSPONSOR Retirement Plan Adviser Team of the Year
Alison Cooke Mintzer, PLANSPONSOR and PLANADVISER

Retirement Plan Adviser Multioffice Team of the Year Judges

Lee Barney, PLANADVISER
Alison Cooke Mintzer, PLANSPONSOR and PLANADVISER
Doug Prince, ProCourse Fiduciary Advisors LLC, formerly The Prince Group of Stifel Nicolaus, 2010 PLANSPONSOR Retirement Plan Adviser Team of the Year
Rick Wedge, Pensionmark Retirement Group, 2010 PLANSPONSOR Retirement Plan Adviser of the Year 

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalist

Gregg Andonian

Baystate Fiduciary Advisors Inc.
Boston, Massachusetts

PA: What is your mission statement?   

Gregg Andonian: Assist ERISA fiduciaries in their risk management efforts while ensuring decisions are in the best interest of plan participants.

PA: Is there any way in which you believe your team/process/structure is unique?

GA: Bottom line is that we deliver more for less. We use a non-commission based model charging the same flat-dollar fee for service regardless of asset size. By limiting the number of clients we will take on and capitalizing on strategic business partners, this enables us to keep our overhead low (i.e. avoids passing high fees on to the client/plan). By delivering a repeatable, prudent process based upon globally accepted fiduciary standards ensures a highly efficient experience for both parties.

PA: What has been successful in terms of increasing participation and deferral rates?

GA: In short, for those clients that elect educational services: quarterly on-site visits to address topics such as group and one-on-one participant meetings; mandatory meetings  for newly eligible employees coupled with attendance at applicable company-wide annual meetings.  The above proactive steps coupled with making it easy for the participant through target-date default (i.e. getting the average participant out of their own way) has truly made an impact.

PA: How have you been able to lower fees for clients?

GA: Plan fees have been lowered through advising the committee on who/how expenses are paid along with our quarterly benchmarking of fund expense ratios relative to their peer group and our annual Fee Benchmarking report to further assess reasonableness from both a participant and sponsor perspective.

By performing both an adviser (i.e. shopping ourselves out) and recordkeeper RFP upon initial engagement and every three years thereafter for documentation/benchmarking purposes, aides in getting everyone to “sharpen their pencils.”

Also upon any new offering “build out or changing of funds, our focus is on institutional, low-cost funds that meet the IPS screening criteria and to avoid the focus on any applicable revenue sharing—i.e., any subsequent higher-expense-ratio funds. Our plan sponsors tend to write as many checks as budgetarily feasible versus passing all costs on to the participants. (continued on next page)

PA: Describe a difficult client relationship issue, and how it was resolved.

GA: We were recently hired by a collaborative group of plan sponsors, but we just couldn’t seem to get on the same page relative to personality match and attending to fiduciary obligations of with one of the collaborative members. We informed the client that it would be better for us to part ways, and returned their prior quarter’s advisory fee to them.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

GA: With one of our clients, we are testing the utilization of a custom target-date model, whereby the glide path is being driven by a third-party entity but the underlying funds/sleeves are composed of the vetted funds from the core offering of the plan sponsor. We are tracking, on a one-year/three-year lookback, approximately a 150- to 200-basis point swing over a peer group of fund family TDF solutions within that same methodology/glide path construct.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.     

GA: The only “special” initiatives outside of our standard process is an initiative driven by one of our clients, a “Retirement Month” campaign whereby a coordinated effort between the client, recordkeeper and ourselves a major presence/focus toward driving participant behaviors through multiple channels.

BUSINESS AT A GLANCE- Gregg Andonian

Plan assets under advisement: $1.7 billion

Median plan size (in assets): $50 million

Total plans under advisement: 30

Total participants in plans served: 9,000 

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalist

Steven Glasgow

Avondale Partners LLC
Nashville, Tennessee

PA: What is your mission statement?

Steven Glasgow: We work with all the constituents of a plan to ensure a “successful retirement plan experience.”

PA: Is there any way in which you believe your team/process/structure is unique?

SG: We place a much greater emphasis on understanding the investment process than most advisers in the 401(k) space. With our background in the evaluation of asset allocation and our investment managers and processes, we are able to bring a much higher level of independent sophistication to the evaluation of the investment process than most competitors. To that end, we have developed, in conjunction with Zephyr Style Analytics, a unique scorecard process to evaluate core investment and target-date options. We have also committed a significant amount of time to understanding and helping our clients implement plan design structures that conform to the latest findings of behavioral finance, having joined the limited number of individuals who are part of the Allianz Certified Behavioral Finance Analyst (CBFA) program.

Lastly, we have instituted an annual electronic plan sponsor survey of our practice through Anova Consulting to understand the satisfaction of our clients relative to other professional retirement plan consultants throughout the industry. To date, we have scored well above average in every category relative to our peers.

PA: What has been successful in terms of increasing participation and deferral rates?

SG: We use a multitiered approach, including pushing our sponsor clients to put in automatic enrollment and automatic escalation processes, and educating participants in group meetings and in one-on-one scenarios in some cases, to take more control due to reduced expected payouts from Social Security and lack of other retirement income sources. (continued on next page)

PA: Have you been able to lower fees for clients?

SG: We undertake an annual benchmark process with all of our clients every year to ensure that fees paid are “reasonable in light of services provided.” We typically use third-party data resources—Fiduciary Benchmarks Inc. (FBi), most notably—because one of the fees we benchmark is our own consulting fee.

PA: Describe a difficult client relationship issue and how it was resolved.

SG: We have a medical professional group that has a large amount of assets invested in self-directed accounts. The custodial trustee and recordkeeper failed to properly account for a number of accounts after the transition of the plan to a new recordkeeping platform. Those mistakes caused the plan to have to file amended audit reports—at great expense—and pay for additional, full-scope audit procedures. We have been able to work with our partners to identify each problem, rectify the recordkeeping issues and negotiate substantial pricing discounts to help offset recordkeeping costs.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

SG: The newest focus for our practice has been on the evaluation of target-date and other QDIA options. In particular, we have been encouraging our clients to understand the interaction between risk construction of the funds and their specific demographics. The interplay between fiduciary responsibility and risk in these products is not well-understood, and we have proactively encouraged our sponsors to take a more meaningful approach to the evaluation of these investment alternatives.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

SG: Our employee group meetings have been more aggressively centered on the message of the need for employees to reach our targeted deferral rate: 10%. We have experienced good results in getting improvements this way, rather than simply talking about “how to invest.”

BUSINESS AT A GLANCE- Steven Glasgow

Plan assets under advisement: $800 million

Median plan size (in assets): $40 million

Total plans under advisement: 23 

Total participants in plans served: 35,000 

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalist

Jeb Graham

CapTrust Advisors LLC
Tampa, Florida

PA: What is your mission statement?

Jeb Graham: To deliver exceptional services in a user-friendly manner, providing a true value to help plan sponsors create the best possible retirement outcome for plan participants.

PA: Is there any way in which you believe your team/process/structure is unique?

JG: Our firm is composed of 41 employees, 17 of whom are consultants, with three dedicated service managers and an in-house investment research/analytics team of nine. I believe our firm is the perfect size for an advisory firm. We are big enough to matter and small enough to still care a lot about our clients.

PA: What has been successful in terms of increasing participation and deferral rates?

JG: After testing in 2012, we are introducing a participant demographic summary report that is presented annually, at one of the quarterly meetings. This formally tracks plan participation rates, average deferral rates, diversification —the average number of options utilized by participants— and percentage of participants on track to achieve a 75% income replacement ratio. Another resource we use is a participant services policy document, which allows plan sponsors to formally craft an overall retirement benefit strategy that establishes metrics for plan success and a process for ongoing monitoring, much in the same way investments are monitored.

In conjunction with these strategies, we have used two additional approaches: plan design changes and increased employee communication. In one particular strategy, we use a combination of group and one-on-one employee meetings to get employees enrolled into the plan and assist them in determining an appropriate deferral rate and investment strategy based on their individual circumstances—getting them over the initial hurdle of inertia. 

Then, to increase deferral rates, I employ two basic approaches: auto-escalation and a gap analysis for partic­ipants to increase deferrals. (continued on next page)

PA: How have you been able to lower fees for clients?

JG: In 2011, we contracted with Fiduciary Benchmarks Inc. [FBi] to provide annual fee and service benchmarking reports to each of our DC [defined contribution] plan clients. We also utilize FBi as part of our standard report for project-based fee analysis and benchmarking studies. In the last 12 months, this benchmarking work has resulted in reduced service provider fees for three project clients (two of which became ongoing clients) and five ongoing clients. In addition, two clients realized a reduction in their advisory fee paid to CapTrust.

PA: Describe a difficult client relationship issue and how it was resolved.

JG: We encountered a sticky situation with one of our clients in which there was some miscommunication from the provider regarding the payment of service fees to an independent TPA firm. In 2011, we completed a fee analysis and benchmarking project, upon the completion of which we were engaged for ongoing advisory services. In analyzing the pricing components, it was discovered that the service provider was paying the TPA firm a form of indirect compensation, which the TPA applied as a credit toward their fee. I convinced the provider to credit the overage of the payment to the TPA toward payment of the advisory fee, thus lowering the client’s net expenses.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

JG: Part of our standard service delivery is an annual review of any model portfolios for those clients who offer such asset-allocation products to their participants. This review includes benchmarking of the overall portfolio strategy, structure and glide path, along with an in-depth analysis of the underlying investments comprising the model portfolios. As part of our annual review of each client’s investment policy, we explored the option of adding a real asset strategy as a potential hedging strategy.

Another initiative introduced in 2012 was an improved process for review and analysis of stable value funds.

BUSINESS AT A GLANCE- Jeb Graham

 Plan assets under advisement: $1.3 billion

Median plan size (in assets): $38 million

Total plans under advisement: 23 

Total participants in plans served: 40,296 

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalist

Timothy Pitney

Sapers & Wallack Inc.
Newton, Massachusetts

PA: What is your mission statement?

Timothy Pitney: Our passion is to help our clients provide the most efficient and effective retirement programs for their employees, helping to close the “retirement deficit” that exists today. We are committed to helping protect the fiduciaries who oversee these plans, giving them peace of mind so they can make proper, unbiased decisions.

PA: What has been successful in terms of increasing participation and deferral rates?

TP: We meet with each of our clients at least annually for group and one-on-one meetings, and are also available by phone at any time for one-on-one consultation. We are also encouraging our clients to implement automatic enrollment and automatic increase.

PA: How have you been able to lower fees for clients?

TP: We routinely benchmark our clients’ fees to the industry and negotiate adjustments where possible. On a new client relationship, we were able to make the investment menu much more efficient and lower fees by 55%—a savings of over $300,000.

PA: Describe a difficult client relationship issue and how it was resolved.

TP: We have a client where it was very difficult to even schedule a fiduciary and investment review. After multiple attempts, we sent the client a letter of our intent to terminate the relationship. They responded, and we were able to go ahead with our work and get the client back on track, improving the fund menu and providing education to the employees. (continued on next page)

PA: Describe plan design initiatives you have led with your customer base during the past 12 months.

TP: Most of the discussions we’ve had with clients regarding plan design have been about automatic enrollment and increases. While everyone understands the merits, the discussion can prove difficult if it increases their match cost or if they feel there is increased administration. Being overly paternalistic is also a concern. We are moving the needle, but slowly. We did design a number of match scenarios for a fast-growing client and are looking to implement a strategy this year.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

TP: We continue to present very detailed information to educate our client base on target-date funds [TDFs]. We review the fund family, the glide path, equity exposure at various life stages and also rate the underlying funds that make up the target dates. For one client, we invited the portfolio managers from three top target-date providers, and they all presented their solutions and rationale for why they structure their portfolios the way they do. We were then able to use this information to further educate the rest of our client base.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

TP: We have a few clients that have locations scattered about the country, so increased use of webinars and other media is proving useful. The most unusual and challenging education event for one client takes place on a fish pier, after third shift, and requires an interpreter!

BUSINESS AT A GLANCE- Timothy Pitney

Plan assets under advisement: $500 million

Median plan size (in assets): $3.2 million

Total plans under advisement: 45 

Total participants in plans served: 13,200 

2013 PLANSPONSOR Retirement Plan Adviser of the Year Finalist

Mark D. Ray

Praxis Consulting
Sacramento, California

PA: What is your mission statement?

Mark Ray: To empower personal accountability for prudent investment and fiduciary decisions through advice, education and inspiration.

PA: Is there any way in which you believe your team/process/structure is unique?

MR: Our firm is uniquely known for its highly credentialed team and breadth of retirement plan management services. One of our processes involves using a multi-layer participant education process that includes video-based education, topic-based webinars, and workplace mentoring programs. A second process is our proprietary compliance system that tracks all required plan documents and participant notifications for our plan sponsors.

PA: What has been successful in terms of increasing participation and deferral rates?

MR: We have utilized behavioral finance concepts to lead discussions with our plan sponsors about the benefits and implementation of automatic enrollment, automatic escalation and match restructuring.

PA: How have you been able to lower fees for clients?

MR: As part of our fee disclosure process in 2012, we conducted an off-calendar RFP for all of our plans, and also engaged a third-party auditor to certify service agreement compliance and fee reasonableness. The outcome of this process resulted in initiating a share class change for two of our qualified plans. (continued on next page)

PA: Describe a difficult client relationship issue and how it was resolved.

MR: We recently met with a law firm client who was considering the termination of their retirement plan. The plan committee had grown frustrated over increased compliance requirements and the time required for proper oversight, and was questioning the value of the retirement benefit.

This client is certainly not the first. We have witnessed elevated frustration and negative sentiment among plan sponsors resulting from increased regulatory and compliance requirements, and recently proposed reductions in deductibility amounts.

In our conversation with this client, we helped them change their paradigm associated with the frustration. We focused on the unique opportunity to provide a benefit with the ability to make such a significant financial impact in people’s lives. Statistically, without this opportunity, employees are unlikely to save on their own. The subsequent result is an enormous social consequence that could include higher taxes, more strain on social programs, and increased health care costs.

PA: Describe the plan initiatives you have led with your customer base during the past 12 months.

MR: We led an initiative to promote increases in default deferral rates for automatic enrollment plans, as well as adding an auto escalation feature in existing auto enrollment plans. We also implemented “eligible investment advice arrangements” within our practice and have this in place for the majority of our qualified plan clients.

PA: Describe the plan initiatives you have led with your customer base during the past 12 months.

MR: One initiative has been to direct all portfolio allocation discussions on “Risk Management based on Global Economics and U.S. Politics.” We have advised plan participants not to go to cash in times of uncertainty. We have educated them on the benefits of staying in the market at a reduced risk level, while allocating their dollar-cost averaged future contributions toward more growth-oriented assets.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

MR: In 2012, we focused on providing our plan sponsors with consistent communication and easy-to-follow steps to lead them through the 408(b)(2) process. In 2013, we’re focused on educating plan sponsors about their fiduciary responsibilities relating to target-date fund selection and stable value funds.

BUSINESS AT A GLANCE- Mark D. Ray

Plan assets under advisement: $371 million

Median plan size (in assets): $2 million

Total plans under advisement: 40 

Total participants in plans served: 4,900 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

Capital Strategies Investment Group

Oakbrook Terrace, Illinois

PA: What is your mission statement?

Capital Strategies: To help clients execute on their fiduciary duties and successfully manage their retirement plans and provider relationships; and to help participants save and invest successfully so that they retire with sufficient savings at the end of their career.

PA: Is there any way in which you believe your team/process/structure is unique?

CS: We believe that we are unique given we are a truly independent advisory firm with no affiliations with any financial institutions—bank, broker/dealer, insurer, investment manager or service provider. All of our investment research, manager search system, performance reporting system, in-depth analyses on various topics—e.g., target-date funds [TDFs], stable value—is proprietary. Our research is primarily focused on what is best for a retirement plan—be it a defined contribution [DC], pension or non-qualified deferral plan—and then specifically for each client’s demographic and risk preferences. We conduct one-on-one committee interviews at the onset of our relationship, which help us to develop greater rapport and trust with each committee member. We have developed a proprietary risk-posture assessment that allows us to score various aspects of our client’s goals and beliefs for their retirement plan(s), risk attributes as a fiduciary and, generally, as a plan sponsor and an individual investor.

PA: What has been successful in terms of increasing participation and deferral rates?

CS: We promote auto-enrollment [AE] to all clients, including retroactive AE, in conjunction with the adoption of auto-increase [AI] up to at least 10%. To help convince clients to adopt our recommendations, we evaluate the potential cost impacts and also project the potential outcome impacts. We also encourage clients to use a match, and have revised match formulas that do not incent participants to save at least 6%. We advise clients to match per pay period versus at year-end. We also promote the use of targeted communications to eligible employees not participating in the plan. (continued on next page)

Image: Barbara Best 

PA: Have you been able to lower fees for clients?

CS: We conduct fee benchmarking at least every three years—and more frequently for clients with high cash flow into the plan, organic growth or growth through acquisition—or as we see the marketplace becoming more competitive and costs being driven down for competitive reasons. All of our benchmark work is customized and real-time versus relying solely on a database with historic figures.

PA: Describe a difficult client relationship issue and how it was resolved.

CS: During our initial fiduciary due diligence process with a new client, we uncovered very outdated plan design features and administrative processes that didn’t support the client’s goals to create more of a pay-for-performance culture, created compliance risks and curtailed participant engagement and savings outcomes. Change for this client, we learned, was not easy. The client felt that the current provider’s lack of dynamic participant tools and resources was hindering participant success. So, they asked us to issue an RFP to solicit bids for their plan.

We conducted a search, and, based on their stated goals, helped the client select a new provider. However, the transition was continually delayed, and after several months it was decided that retaining the existing provider but converting to an improved platform was the optimal solution. The client is now committed to improving plan design, administrative processes and plan investments; the provider lowered their pricing and is more strategically engaged—ultimately, a better outcome for the plan participants, fiduciaries and the plan sponsor.

PA: Describe the plan design initiatives you have led with your customer base during the past 12 months.

CS: We have worked diligently to promote using auto-features, increasing the plan default rate from 3% to 6%, and also applying these changes to existing employees. Low participation and employee deferrals are the primary cause of insufficient savings at retirement. We have also been addressing leakage by identifying ways to place limits on the loan feature.

BUSINESS AT A GLANCE- Capital Strategies Investment Group

Plan assets under advisement: $5.2 billion

Median plan size (in assets): $49 million

Total plans under administration: 112 

Total participants in plans served: 270,000 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

Everhart Advisors

Dublin, Ohio

PA: What is your mission statement?

Everhart Advisors: We believe all employees should plan for, and are able to achieve, financial independence and retirement income security.

PA: Is there any way in which you believe your team/process/structure is unique?

EA: Everhart delivers a comprehensive suite of services to enhance defined contribution [DC] plans, including vendor fee and service benchmarking, investment due diligence, employee education and advice, compliance and fiduciary protection, along with advanced plan design and administrative support.

Our independence, team approach, focus and expertise allow Everhart to deliver the necessary support, leadership and services with honesty, integrity and world-class competence. Built specifically to advise and service employer-sponsored retirement plans, our firm includes six Accredited Investment Fiduciaries [AIFs], a Chartered Retirement Plan Specialist [CRPS] and two Certified Financial Planner [CFP] practitioners. A team of highly qualified and knowledgeable associates is assigned to and oversees each client relationship. 

Over the past year, Everhart has continued to hold plan sponsor workshops, including the most recent, titled “Fee Disclosures Are Delivered … Now What?” While continuing to provide on-site targeted education sessions to employees, including one-on-one personal planning, retirement needs and wealth management advice, the firm has introduced quarterly “after-hours” workshops covering a variety of topics and issues, with invitations provided to all client employees and spouses. In addition, a firm partner and the lead employee education consultant, Matt Romeo, became one of only 50 individuals to participate in the Behavioral Finance PlanSuccess Certification program, provided through the Allianz Center for Behavioral Finance. We are now capable of performing PlanSuccess Behavioral Audits of the education management plan, which allows us to evaluate the behavioral health of a plan. (continued on next page)

Image: 

Front row (L to R): Matthew Romeo (Partner/COO), Scott Everhart (President/CEO)
Back row (L to R): Brian Hanna (Partner/Senior Relationship Manager), Frank Ciotola (Partner/Relationship Manager)

PA: What has been successful in terms of increasing participation and deferral rates?

EA: Providing gap analysis reports proactively to employees without their request; utilizing easy-enrollment services provided through platform vendors, which require a yes/no decision; targeted group education based on demographics such as age or income to ensure applicability and timeliness; one-on-one personal planning visits and advice; implementation of automatic enrollment.

One example of the impact is the doubling of total annual contributions from $1 million to $2 million for a client in less than one year of engagement. This was achieved through on-site education at many of the sponsor’s 25 locations nationwide, and through both increased participation and increased deferral rates for those already participating. We will continue to provide comprehensive and detailed retirement needs analysis on a one-on-one basis to ensure employees have an understanding of appropriate/necessary savings rates.

PA: How have you been able to lower fees for clients?

EA: With a focus on transparency and revenue-sharing for well over a decade, [lowering fees] is an area of extreme expertise and achievement for the firm. The process most often includes determining/confirming sub-transfer agent credits and additional revenue-sharing sources, along with direct compensation. We then benchmark against comparable providers, presenting the findings to the incumbent for negotiation and/or moving forward with alternative vendor evaluations or transition.

Of course, the process described would include use of alternative share classes and attempt to move compensation from indirect to direct, and from asset-based to a fixed per balance when possible. Most recent examples include: 1) uncovering $110,000 of [asset-based] indirect compensation received by a recordkeeper/administrator, in addition to $10,000 direct compensation [the total equaling $130 per balance], then negotiating the expense down to $87 fixed per balance, with all revenue-sharing to an ERISA budget, for an expense decrease of 35%. Client cost savings of 35% to 40% are our norm.

BUSINESS AT A GLANCE- Everhart Advisors

Plan assets under advisement: $600 million

Median plan size (in assets): $2 million

Total plans under administration: 130 

Total participants in plans served: 15,000 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

Graystone Consulting –Cincinnati

Cincinnati, Ohio

PA: Is there any way in which you believe your team/process/structure is unique?

Graystone Consulting: Given our team’s size and experience, we believe we are unique in regards to the level of service that we are able to provide. Many plan advisers focus on the fiduciary aspects, fees and funds in relation to corporate retirement plan management. Our team provides all of these services. However, our plan management is largely focused on income replacement ratios for employees at retirement. Given the numerous behavioral-related obstacles that tend to keep participants from saving enough money for retirement, one of our team members is a Certified Behavioral Finance Analyst [CBFA]—one of only a couple in our state—and a ­Chartered Retirement Plans Specialist [CRPS] who is dedicated to orchestrating plan design enhancements along with retirement plan education programs to help our corporate clients dramatically boost plan deferrals and participation rates.

PA: What has been successful in terms of increasing participation and deferral rates?

GC: Since inception, our group has been an advocate of automatic enrollment. In addition, we have also recommended re-enrollment. In fact, one of our clients is a large retail organization with young employees and high turnover. With automatic enrollment, we have been able to maintain their participation rate at 87%; it had been 65% for many years before our initiative.

Recently, another client, which has about 250 employees across the Midwest, converted their plan to a new provider and re-enrolled all of their employees to reach a participation rate near 100%.

From a face-to-face employee education standpoint, we use express enrollment cards and iPods to enroll participants during meetings, while it’s fresh in their minds, and presented the 1% challenge to another client. With the 1% challenge, we typically obtain enrollment and/or contribution rate increases for 30% of the individuals who attend our meetings. We simply challenge them to enroll at 1% or increase their contribution rate by 1% and show the potential impact over time. 

Furthermore, we have also been an advocate of auto-escalation since its debut, and we offer plan design advice to increase deferral rates. (continued on next page)

Image:  

Front row: (L to R)
Jeffrey Adler – Consulting Group Analyst
Thanh Pham – Portfolio Management Associate
Elaine Cohen – Technical Reporting Analyst
Lynn Goedde – Registered Associate
Robin Rudolph – Senior Registered Associate

Back row: (L to R)
Kelly Kelp – Senior Vice President
Chris Vordemesche – Corporate Retirement Director
Todd Washburn – Senior Vice President
Bill Talmage, CIMA – Institutional Consulting Director
Mike Kleinfelder, CFP – Vice President
Joel Handorf – Institutional Consultant

PA: How have you been able to lower fees for clients?

GC: Through vendor negotiation and provider searches, we have significantly lowered the fees for many of our clients over the past year. Last year, we conducted eight searches and reduced our clients’ fees by an average of 40%, typically lowering their total plan cost from 1.25% to 0.80%. In other situations, vendors have immediately presented a fee reduction as soon as we were hired as outside consultants. Our benchmarking tools have helped us tremendously, not only to lower fees but to help our clients understand their fees and oftentimes change the methodology of the fee calculations—e.g., move from asset-based to a per-head structure.

PA: Describe a difficult client relationship issue and how it was resolved.

GC: One of our publicly traded clients has Section 16 insiders who sit on the investment committee. Through plan governance assistance, they have moved to mitigate their potential fiduciary concerns. In another case, a client’s recordkeeper was purchased by another organization, and we conducted all of the due diligence necessary for them to make an informed decision. One of our new clients had no fiduciary process in place, and we developed a turnkey process that was implemented in the course of two investment committee meetings and for which we signed on as a co-fiduciary for all of our services.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

GC: Some of our proudest initiatives recently have involved “401(k) boot camp” (education programs for a large national retailer); a high-end, executive-level financial planning program for a mid-size, publicly traded client; and the re-enrollment and provider change for a long-time client that included an education roadshow and targeted employee education materials.

BUSINESS AT A GLANCE- Graystone Consulting –Cincinnati

Plan assets under advisement: $2.75 billion

Median plan size (in assets): $22 million

Total plans under administration: 50 

Total participants in plans served: 100,000 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

Maresh Yoshida 401k Group

Austin, Texas

PA: What is your mission statement?

Maresh Yoshida: To always provide independent, objective and customized retirement solutions that are in the best interests of our plan sponsor clients.

PA: Is there any way in which you believe your team/process/structure is unique?

MY: We assign each plan sponsor client a consultant contact within our organization that has a strict client cap of 20 relationships. This allows MY 401k Group to be the outsourced member of the plan sponsor’s 401(k) committee and take virtually all plan management responsibilities off the plate of our clients.

Our motto has always been that the growth of our organization going forward is that “service will lead sales.” Given that we currently serve only 19 clients and project to bring on only three to seven clients per year, we have ample capacity to grow.

PA: How do you promote your benchmarking targets?

MY: Our group leads every new potential client engagement meeting with a disclosure that we have a strong preference for our clients to engage in a 100% automatic re-enrollment into lifecycle TDFs with an annual deferral percentage increase of 1% per annum. (continued on next page)

Image: L to R: Nathan J. Sharp, T. Henry Yoshida, Michael W. Maresh, Linda K. Lim  

PA: What has been successful in terms of increasing participation and deferral rates?

MY: We’d like to highlight one particular case from 2012 that resulted in one of our plans moving from an active participation deferral rate of 44% to 100% active participant deferrals. The 944-participant 401(k) plan had a qualified nonelective contribution [QNEC] safe harbor 401(k) plan that gave participants 4%, whether or not they were actively contributing any of their own funds to the plan. We quickly determined that the actual active deferral percentage rate was only 44%, for those who contributed something in addition to the 4% QNEC that was given to them. Our group did a retirement readiness analysis and worked with the plan sponsor client to convert the plan to a 5%, dollar-for-dollar, safe harbor match design.

In addition to this, we were able to convince the client to do a 100% re-enrollment into TDFs, combined with an intensive, customized education campaign. We were ecstatic to see that the active deferral participation rate went to 100% and that the average deferral percentage went up to 6.4%. In the coming year, our focus is to increase this active deferral rate to the 7.5% level.

In 2012, one of the key initiatives that our group implemented was to position advice, powered by GuidedChoice, to our plan sponsor participants. Our participants may now speak with a licensed financial adviser, at no charge, to determine a deferral percentage that will help our participants be better prepared for retirement. Deferrals for participants who conducted an interview or had interactions with the online version of GuidedChoice surged from just below 5% to well over 13%.

PA: Describe the plan design initiatives you have led with your customer base during the past 12 months.

MY: In 2012, the Maresh Yoshida 401k Group went to each company in our client base that was not currently exhibiting what we consider to be best practices from a plan design standpoint.

One of the key initiatives for our group is to have our plan sponsor client committees visit their recordkeeper provider home offices for a day of plan design education and to discuss improvements. In 2012, the Maresh Yoshida 401k Group accompanied more than 50% of our existing plan sponsor client base on such trips. To do this, we had extensive modeling done prior to the visit and listened to several suggestions from the various providers’ own in-house ERISA counsel and specialized plan sponsor solutions groups.

As a result of one such recent visit, our sponsor client implemented a full, 100% TDF re-enrollment and the addition of a non-qualified deferred compensation [NQDC] plan to supplement the retirement readiness needs of individuals with more than $165,000 of annual household compensation. The Re-Enrollment Analyzer Report indicated that a re-enrollment, coupled with an annual deferral increase, would increase the retirement readiness index from 37% to 68%, across a 1,300-participant plan sponsor.

BUSINESS AT A GLANCE- Maresh Yoshida 401k Group

Plan assets under advisement: $728 million

Median plan size (in assets): $19.8 million

Total plans under advisement: 19 

Total participants in plans served: 13,640 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

Newport Capital Group LLC

Red Bank, New Jersey

PA: What is your mission statement?

Newport Capital Group: Newport Capital Group’s mission is to help plan sponsors fulfill their fiduciary responsibilities under ERISA. We’re committed to providing the highest level of service possible, hiring only the brightest minds in the business, and are dedicated and committed to the retirement plan industry.

PA: What has been successful in terms of increasing participation and deferral rates?

NCG: We have undertaken myriad strategies, beginning with robust education and communication focused on two distinct goals: to stress the importance of planning for retirement and the value of the benefit offered by their employer.

The next strategy involves the use of specific plan design features that recognize the role of behavioral economics in influencing retirement outcomes. We work with the plan provider to create customized communications that are tailored to the needs of each client’s participants.

Using our customized approach, we first identify those participants and demographic groups that are not contributing or participating in the plan. We then work with the plan provider to target those employees directly using language and methods specific to the individual or group. As an example, for a younger, tech-savvy demographic, we might suggest a Web-based, touch-focused campaign on the need to save for the future and how small and seemingly insignificant sums of money can compound, tax-deferred, into large sums when invested over a long time horizon. 

The next strategy involves the use of plan design features, such as auto-enrollment or an annual passive re-enrollment feature with an “opt out” option. (continued on next page)

Image:  

Back row: (L to R) Elisabeth Greeley, John Wibbelsman, CFA; Jason Elhomsi; Lauren Goldfarb, AIF; Samantha McArthur, AIF; Nicholas Bellia, AIF; Peter Cavallini, AIF, CFA; Maryann McGloin; Kevin Lavelle, AIF; Gail Thompson; Allison Higgins
Seated: (L to R) Domenic DiPiero III; Michelle Bennett, AIF, CFP

PA: How have you been able to lower fees for clients?

NCG: When benchmarking fees, Newport Capital Group undertakes an extremely comprehensive and thorough process on behalf of our clients. Provider pricing quotes can vary wildly based on variables such as industry, plan size, location, cash flow, etc. So rather than utilizing a benchmarking database, we reach out to providers instead to ensure the best possible pricing for clients.

We recently assisted a client that acquired a local competitor. The complexities surrounding pricing negotiations, a consolidated lineup, fund mapping and fiduciary issues of administering the two 401(k) plans became a cause of concern. Since the plan was nearly doubling in size, the influx of new funds became a triggering issue for the committee to benchmark the plan.

Newport Capital Group guided the client through the pricing/RFI process by analyzing what plan elements they wanted to keep, such as open architecture, registered product platforms, fully bundled educational services, etc. Then, we reached out to a wide array of providers who met our client’s broad requirements with a full-pricing template/questionnaire and conducted data congregation and analysis to deliver our recommendations to the client.

We advised them to make broad changes to the plan, including to optimize the lineup to improve and consolidate the fund lineup, and to place both plans under a master trust agreement, allowing the provider to view these two separate plans as one pool of assets. As a result, plan fees were reduced by 45%.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

NCG: Target-date and asset-allocation funds are an increasingly large part of the investment analysis that Newport Capital Group performs. We take the position that target-date funds [TDFs] and other broadly diversified asset-allocation options should be included in the lineup for every plan for which we advise.

Our analysis on TDFs begins with an assessment of the underlying asset-allocation, judging the fund’s mandate as to where it stands on the “to retirement” or “through retirement” spectrum. Once this has been established, we will analyze and benchmark the fund based on the following criteria: demographic fit, glide path, expenses, underlying sub-adviser performance, number of underlying asset classes, absolute/risk-adjusted returns, and negotiated revenue-sharing expenses with the provider.

BUSINESS AT A GLANCE- Newport Capital Group LLC

Plan assets under advisement: $2.6 billion

Median plan size (in assets): $75 million

Total plans under advisement: 82 

Total participants in plans served: 52,000 

2013 PLANSPONSOR Retirement Plan Adviser Team of the Year Finalist

The Willhite Institutional Consulting Group

The Woodlands, Texas

PA: What is your mission statement?

Willhite Institutional: Our team’s ultimate mission is to see plan participants retire with dignity and confidence in their financial security. Ancillary to this is helping the plan sponsor with the corporate governance and plan decisions necessary to fulfill their fiduciary obligations and offer a competitive retirement plan.

PA: Is there any way in which you believe your team/process/structure is unique?

WI: Our team is made up of five individuals with diverse backgrounds who help our clients reap the rewards of our knowledge and understanding of retirement plans. One team member has been working with retirement plans since 1984.

Other team members bring expertise in behavioral finance, institutional project management and industry trends. We understand the most important driver of retirement readiness is the participant’s contribution rate, and we spend considerable effort on plan design and education initiatives to drive that. Second most important will be the participant’s overall asset allocation, so we focus heavily on the target-date fund suite most appropriate for a plan. Finally, the third largest determinant of retirement readiness will be the specific individual funds used in the plan, so we are careful in our screening process.

PA: What is your approach to new clients?

WI: When the Willhite Institutional Consulting Group onboards a new plan—as well as yearly for existing plans—we work with the plan’s investment committee to perform a feasibility study regarding plan design and incorporate automatic enrollment and automated deferral increases.

When we evaluate a feasibility study for a plan in an industry with high employee turnover, auto-enrollment may not be an appropriate solution, as it can be cost-prohibitive. Thus, we then focus on education initiatives. When we design education programs for plans, our team draws research from the behavioral finance field to assist us in developing initiatives that are practical and targeted to specific participant demographics and industries.We also recommend that all plans utilize asset-allocation solutions. (continued on next page)

Image: (L to R) Michael O’Laughlin, CFA (Senior Wealth Strategy Associate), Taylor Willhite (Team Administrator),  Jon Willhite, CIMA (Senior Institutional Consultant), Brenda Paulson (Client Service Associate) and Robert Vaughan, CRPS (Retirement Plan Consultant) 

PA: What has been successful in terms of increasing participation and deferral rates?

WI: Through implementing new plan designs to help with the automatic enrollment features, we have helped increase plan participation over the last two years. The most successful way we have increased contributions is through auto-escalation.

PA: How have you been able to lower fees for clients?

WI: When we are hired by a plan, one of the first things we do is request a fee disclosure statement from their providers. For example, we recently worked with a small $5 million plan with 105 participants and discovered their current provider was charging 42 basis points [$21,000] in addition to a third-party administrator [TPA]. We were able to reduce the fee to $7,500 through a bundled service provider.

PA: Describe a difficult client relationship and how it was resolved.

WI: Regarding this same client, their plan provider was very difficult to work with and not willing to disclose fees or return calls. The plan sponsor had recently terminated their relationship with their payroll company and realized the new payroll company could not provide the services they promised. The client felt another conversion at this time would be additional stress for their employees.

Once we showed the sponsor the cost savings and the robust Internet capabilities available, they felt the move was in the best interest of the participants, and we are in the transition process.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

WI: We have started to utilize plan providers that have the software—i.e., Internet and phone tracking—that helps us track the success of our education and communication initiatives. We strongly believe it is plan design that will help participants be ready for retirement.

BUSINESS AT A GLANCE- The Willhite Institutional Consulting Group

Plan assets under advisement: $950 million

Median plan size: $50,000

Total plans under advisement: 27 

Total participants in plans served: 10,000 

2013 PLANSPONSOR Retirement Plan Adviser Multioffice Team of the Year Finalist

Alliance Benefit Group Financial Services, Corp.

Headquartered in Albert Lea, Minnesota

PA: What is your mission statement?

Alliance Benefit Group: To provide financial security for our clients’ most valuable asset—their employees.

PA: Is there any way in which you believe your team/ process/structure is unique?

ABG: Most advisers continue to focus their service model with an emphasis on fund selection and fiduciary governance. We do not discount the importance of these services; however, a plan can offer the best funds, superior recordkeeping and administration, and an exceptional participant website—and still not be successful. Therefore, in addition to providing traditional plan success deliverables, we also aggressively benchmark participant retirement readiness.

Our entire service model is extremely participant- centric. We have developed an education policy statement for our clients that outlines targeted messaging participant education and an advice campaign. It also establishes what we refer to as the “90-10-90 goal” for the plan which is comprised of a 90% participation rate, with an average participant deferral rate of 10%, and 90% of participants using some sort of asset allocation/investment advice tool.

Accordingly, we combine what we call “Results Based Plan Design” using a myriad of automatic features, both in the deferral and investment arena, with robust onsite participant-centric services which include: 

• On-site participant education meetings;
• On-site participant one-on-one meetings;
• The creation of five risk-based asset allocation model portfolios composed out of the core funds from the plan’s investment menu;
• An annual retirement readiness report prepared for each participant;
• An aggregate retirement readiness report prepared for the plan sponsor; and
• A benchmarking report for the plan sponsor detailing progress toward the 90-10-90 goal. 

Our process for quarterly fund performance monitoring is also unique. Our investment professionals have developed a proprietary scoring system based on one-, three, five, and 10-year performance; three-year alpha; three-year beta; three- and five-year Sortino ratio; three-year standard deviation; and net expense ratio rank. This methodology assists client investment committees not only in identifying a problem fund, but also in moving it into a status for possible removal consideration. (continued on next page)

Image:  

Back row: (L to R) Michal Oothoudt, Jeffery Englin, Bradley Douglas, Lynn Kermes, Kevin Dulitz
Middle row: (L to R) Stephen Brownlow, Paul Wick
Front row: (L to R) Grant Arends, Bradley Arends, Brian Westemeyer

PA: What has been successful in terms of increasing participation and deferral rates?

ABG: To achieve a 90% participation rate goal, we start with plan design. Almost all of our defined contribution clients have a matching contribution; allow their participants to raise or lower, start or stop their contributions at any time; and offer both regular pre-tax and Roth contribution options. Each client has been encouraged to adopt auto-enrollment and auto-escalation, not only for newly eligible participants, but also for current nonparticipating employees, with an annual opt-out feature.

Mandatory retirement plan orientation meetings conducted by our personnel, educate participants about the plan and how to use it appropriately to accomplish the goal of a successful retirement. At plan entry, and then periodically thereafter, each participant is provided a customized analysis of how different contribution amounts will affect their take-home pay and their projected end-retirement benefits balance.

PA: Have you made any changes to your fee structures or fee disclosures in the last year? If so, how/what/why?

ABG: While the industry has only recently focused on a fee based, fully transparent pricing model, this has been a core value and belief of our firm for 20 years. It was 1993 when our firm transitioned away from the traditional commission-based environment. At that time, we adopted and implemented the fully transparent fee-based approach that receives so much focus today in light of 408(b)(2) and 404(a)(5). We pride ourselves in continuing to be pioneers and industry leaders in the retirement consulting space. We accomplish this based upon one end goal that has always been the core of our practice: what can we do to help plan participants achieve a successful retirement.

BUSINESS AT A GLANCE- Alliance Benefit Group Financial Services, Corp.

Plan assets under advisement: $1.9 billion

Median plan size (in assets): $4.4 million

Total plans under advisement: 139 

Total participants in plans served: 41,250 

2013 PLANSPONSOR Retirement Plan Adviser Multioffice Team of the Year Finalist

Pensionmark Retirement Group 

Headquartered in Santa Barbara, California

PA: What is your mission statement?

Pensionmark Retirement Group: Pensionmark Retirement Group was founded in 1988 as a consulting firm dedicated to the retirement plan industry. We have assembled a team of committed and experienced professionals with one guiding purpose in mind: to help plan sponsors and individual investors meet and exceed their retirement plan needs and obligations. Our mission is to offer the most innovative strategies to assist employers in managing the complexities of their retirement plans while helping their employees prepare to retire with dignity, to provide the best retirement plan consulting services in the nation with the utmost professionalism and uncompromising integrity.

PA: Is there any way in which you believe your team/ process/structure is unique?

PRG: Our size enables us to have dedicated resources for services such as investments, employee education/communications, fiduciary support and RFP [request for proposal] services. We believe this specialization allows us to deliver a higher level of service in each component of what we offer.

PA: What has been successful in terms of increasing participation and deferral rates?

PRG: Plan design features such as automatic enrollment and auto-increase have the most immediate effect. In addition, our comprehensive financial wellness program engages employees, and engaged employees participate more and have more successful outcomes.

PA: Have you made any changes to your fee structure in the past year?

PRG: We are moving more towards fee-based compensation paid from an ERISA [Employee Retirement Income Security­ Act] or PERA [Public Employee Retirement Association] budget. It represents about 91% of our revenue. (continued on next page)

Image:  

Back row: (L to R) Shane Hanson, Laura Battle, Bill Rice, Troy Hammond, Mike Woods, Michele Lantz, Ronnie Cox
Front Row:  (L to R) Roxana Frausto, Kristine Miller, Devyn Duex, Taylor Stone, Daren Alcantar, Krista Hauser, Mary Francisco, Mallory Van Leeuwen, Brooks Allen

PA: How have you been able to lower fees for clients?

PRG: We start by stripping out excess revenue from the investments, trying to offering a pure institutional lineups, if possible. Then each component of service is added back and charged accordingly—administration, recordkeeping, advisory services, etc. We then leverage the providers to reduce each fee component as much as possible. Our scale also allows us to deliver services at a lower cost point. Our typical fee reduction in a provider change is 27%.

PA: Describe a difficult client relationship issue and how it was resolved.

PRG: The most difficult relationship issues revolve around plan sponsors that are not engaged and do not want to put the effort into their responsibilities. We had a client that threatened to switch providers and advisers because a new adviser’s proposal offered no fees and claimed they could even provide money back to the plan sponsor. They told the sponsor that the fiduciary responsibilities are “overblown.” The client mandated we offer the same level of service to them, and we actually terminated our relationship with the client.

We had a client that we moved to a new provider, and after a period of time they were unhappy so we moved them again. Two years later the same situation arose and we had to make a third move. The third provider was the right fit. We learned that what clients say they want and what they really want may be different. Our jobs as advisers is to help them understand the different components of service so they can make an educated analysis of what is important to them, use our expertise to find the right provider for their needs, and set proper expectations. Our process for vendor selection now includes a comprehensive qualitative analysis to address those issues.

PA: Describe any particularly noteworthy plan design initiatives you have led with your customer base during the past 12 months.

PRG: We have done a lot of “plan refreshes” where we re-enroll employees with a QDIA [qualified default investment alternative] default and at the same time implement auto-enrollment and auto-increase. Tied in with our financial wellness program, we have had huge tremendous success in improving employee participation and deferral increases, as well as employee engagement.

BUSINESS AT A GLANCE- Pensionmark Retirement Group

Plan assets under advisement: $5.7 billion

Median plan size (in assets): $8 million

Total plans under advisement: 683 

Total participants in plans served: 150,000 

2013 PLANSPONSOR Retirement Plan Adviser Multioffice Team of the Year Finalist

Sheridan Road Financial

Headquartered in Northbrook, Illinois

PA: What is your mission statement?

Sheridan Road Financial: Our primary goal is to help our clients attain financial peace of mind. Our experienced professionals partner with clients to offer sensible planning strategies designed to help them reach their financial goals and guide them through volatile markets. As fiduciaries, we offer prudent, tax-efficient, cost-effective, participant-driven solutions.

PA: Is there any way in which you believe your team/process/structure is unique?

SRF: Reputation. Our firm has been servicing the middle-market retirement market for more than 40 years. We have one of the largest independent practices in the country and have been continually recognized for our commitment to both the plan sponsor and its participants. We are thought leaders on compliance, regulatory, ERISA, DOL, fiduciary and educational issues and have been repeatedly recognized for our work. In 2007, we were recognized as a Top Five Retirement Plan Adviser by PLANSPONSOR magazine, the industry-standard publication. More recently, in 2011, we were recognized as one of the three finalists for the 2011 401(k) Advisor Leadership Award, co-presented by ASPPA and Morningstar.

Our clients represent leaders across all industry segments, including not-for-profit, religious, food and beverage, business services, manufacturing, technology and health care. 

Sheridan Road is completely independent and able to work with any product provider, money manager, vendor or third-party administrator [TPA]. We remain an industry advocate whenever legislative or regulatory issues arise. Some of the organizations on whose boards we sit include the Allianz Global Investors Center for Behavioral Finance,  American Society of Pension Professionals and Actuaries, NAPA – Government Affairs Council, Profit Sharing Committee of America and the Retirement Advisor Council. (continued on next page)

Image: (L to R) Ron Kochman (Senior Vice President), Chelsea Barry (Financial Analyst), Jeremy Weith (Senior Vice President),  Jenna Thomas (Marketing Associate), Jay Warren (Managing Director), Pete Hass (Managing Director), Megan Doherty (Vice President), Daniel Bryant (Managing Partner), Jim O’Shaughnessy (Managing Partner), Karen Campbell (Controller), Alona Anspach (Managing Director), Katy Huszagh (Financial Analyst), Chuck Williams (Managing Director), Paul Kubasiak (Wealth Management Associate), Sheryl Lewis (Office Manager), James Jarmaillo (Vice President)  

PA: What has been successful in terms of increasing participation and deferral rates?

SRF: Sheridan Road has a comprehensive participant education strategy customized to individual client needs. We take education one step farther by working with our clients’ investment committees to better understand the employee demographics and previous obstacles to increased employee participation.

We are a major advocate for increasing deferrals through automatic design features, in conjunction with group and individual participant education.

PA: Describe a difficult client relationship issue and how it was resolved.

SRF: Sheridan Road is the retirement consultant for a manufacturing client based in Chicago. When we were introduced, the service provider was Prudential and prior to that, CIGNA, which Prudential acquired. The existing broker had been in place for the last 10 years and required all communication from the service provider to flow through him. This resulted in the plan sponsor being unhappy with both the broker and the service provider. We were referred in and hired by the plan sponsor. The first thing we did was to have a meeting with the client and the service provider to clear the air and improve communication. A fresh start was made, and communication improved immediately, leading directly to more effective plan management and health.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base during the past 12 months.

SRF: A major initiative is to stress the importance of open architecture plan designs. Another is to promote the increased usage of institutional share classes in conjunction with a more transparent fee structure. As lifecycle investments grow in popularity and usage (they’re typically named as QDIA and so is the plan default), we are putting pressure on service providers to make available nonproprietary lifecycle options and/or the ability to create customized solutions to meet individual client needs. We have also seen an increased scrutiny on stable value funds based on capacity issues and the need to provide fee transparency, liquidity and increased portability, among other considerations. We have also focused much of our efforts on bringing institutional retirement plan practices to the mid-market.

BUSINESS AT A GLANCE- Sheridan Road Financial

Plan assets under advisement: $5.6 billion

Median plan size (in assets): $20 million

Total plans under advisement: 215 

Total participants in plans served: 230,000