October 12, 2017

2015 RPAY – Heffernan Retirement Services

Reported by

PA: How is your team/process/structure unique?

Heffernan Retirement Services: We are unique because each of our clients is unique. We take each plan’s demographics, needs, concerns and learning style into consideration when we design a program. We wouldn’t be here if it wasn’t for our clients, and our working environment is filled with diverse, smart, entrepreneurial folks whom we all consider our family. Most employees on our team have been with Heffernan for over 10 years, and our combined knowledge of the financial services industry adds up to over 100 years. Our motto is: “Answer the phone and have fun.” This creates a fun office environment that allows us to service our clients at the highest level.

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Our process and structure are unique because our focus is increasingly on improving participant outcomes while maintaining a high level of fiduciary support for the plan sponsor. We utilize the “Save More -Tomorrow” program, which is the first comprehensive application of behavioral finance designed to improve retirement outcomes.

Our focus on the participant has helped us redefine what employee education means. Our goal is now to meet employees via the medium and at the time that is right for them, instead of trying to solve the retirement puzzle for them in one annual meeting. We have created a suite of recorded presentations, both client-specific and general in content, which are available online to allow participants to learn at their own pace and on their own schedule.

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

HRS: We believe that in order to help participants save efficiently, we have to cater to their different stages in life and keep it simple. We use a combination of behavioral finance and technology. At Heffernan Retirement Services, we use LPL Financial’s Worksite Financial Solutions as part of our technology, in conjunction with Shlomo Benartzi’s “Save More Tomorrow” behavioral finance tools.

Worksite Financial Solutions is a beginning-to-end retirement solution that helps create confidence for employees in their whole financial life—retirement, income planning, budgeting and day-to-day money management. It can be applied to each stage of the employees’ careers, whether they are just starting out, hitting their peak earning years or getting close to retirement.

The Financial Finesse leg of Worksite Financial Solutions allows us to assess the employees’ biggest hurdle or concerns of their financial life. The participants take a companywide assessment, and we are provided with metrics to determine what we should focus on. We come back to the plan sponsor and provide our education and communication strategy, whether it is individual consultations, education meetings, webinars, Brainsharks, email communications, flyers, you name it. We use whatever it takes to relate to the demographics of the company and the participant base.

PA: What are the most important issues your plan sponsors face with their company retirement plan, and what specific actions do you take to assist them in overcoming those issues?

HRS: Many of our clients have become acutely aware that stressed employees are a financial drain on the company. A stressed employee usually has lower productivity, high health care costs and high absenteeism, all of which can hurt not only a company’s bottom line but the success of the organization as well.

Similar to how health care companies have been rolling out health and wellness programs, we believe adding a financial wellness program—such as the Financial Finesse program we offer to our clients—can help employees get a better understanding of their financial situation and where they can make improvements.

A simple five-minute assessment can help them begin thinking about the financial stress in their lives and what we can do to help relieve that stress. The topics cover saving for retirement but also reach more broadly into the employees’ lives, looking at debt management, setting up a rainy-day fund, taking care of loved ones after an accident or death, educational expenses and tax management.

BUSINESS AT A GLANCE

PLAN ASSETS UNDER ADVISEMENT: $1.65 billion

MEDIAN PLAN SIZE (IN ASSETS): $15 million

TOTAL PLANS UNDER ADVISEMENT: 123

TOTAL PARTICIPANTS IN PLANS SERVED: 31,000

October 12, 2017

2015 RPAY – The D’Aiutolo Institutional Consulting Team at UBS Financial

Reported by

Dexter Reaves

PA: What have you done in the past year to improve participants’ retirement readiness?

D’Aiutolo Institutional Consulting: What good is a retirement plan that doesn’t lead to employees being ready to retire? Plan design and investments alone aren’t enough for 401(k) plans to achieve participant retirement readiness. To address this, we added a new position and service. The position is the participant outcomes director; the service is to create a partnership with the human resources (HR) staff of our clients and the recordkeeper to identify all workers within 15 years of retirement and to customize communication strategies that will allow participants to confidently assess the viability of their strategies to produce adequate lifetime income. These services include off-site group meetings for employees and their spouses, personalized gap analyses and individual retirement income planning sessions.

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PA: As a retirement plan adviser, what do you take the most pride in?

DIC: What we take the most pride in is our activism and engagement to work tirelessly on behalf of our clients and their employees. When we take on a client, our mindset is to design a program that addresses the needs of the employees who need us the most. Saving for retirement and turning that savings into adequate lifetime income isn’t easy for most Americans. That is why programs like auto-enrollment and target-date funds (TDFs) alone won’t get it done. Americans are continually faced with challenges: paying their rent or mortgage, putting their kids through college and affording health care, among others. Our team thrives on spending time in the cafeterias and being on-site with our clients. That is where trust is forged.

PA: What benchmarks do you use to measure plan and client success? How do you react to clients or prospects that don’t share your goals for their retirement plan?

DIC: We sort clients into two categories: those that are interested in a competitive benefit and those that are interested in benefit adequacy. Ideally, we want all of our clients to have the desire to work as tirelessly as we do in order to see that their employees can adequately retire one day. Unfortunately, not all employers are onboard with this mission from the onset. We don’t negatively react to those that don’t share our goals.

Our approach with those not onboard with solving for retirement readiness is to provide them with the data to one day convince them otherwise. The benchmarks we use are average income replacement ratios, participation rates, deferral rates, asset-allocation fund usage as a singular holding, average number of funds held, those invested in one non-asset-allocation fund, percentage of assets in the fixed fund, average account balance, number of loans and average loans outstanding, and number of unique Web and call-center users. In addition, we segment these benchmarks by age, salary and length of employment demographics.

PA: What are the most important issues your plan sponsors face with their company retirement plan, and what specific actions do you take to assist them in overcoming those issues?

DIC: We see two issues, mainly: business succession and how to manage an aging work force. Most of the clients we serve have between 100 and 1,000 employees. Many of the owners and executives we work with will want to monetize their value before they transition to new owners. Also, most of our clients have a work force that is continuing to age, and, without pension plans, most have no strategy to transition older employees out and welcome younger employees in.

The one value we bring to help solve this challenge is achieving retirement readiness for all employees. If we can create a defined benefit (DB)-like structure, where the employer can forecast if and when its employees can retire, we can help with its long-term strategic initiatives. This analysis also helps show where the company can deploy resources toward managing health care costs, recruiting, retention and adding additional employer contributions to the retirement plans.

BUSINESS AT A GLANCE

PLAN ASSETS UNDER ADVISEMENT: $1.4 billion

MEDIAN PLAN SIZE (IN ASSETS): $15 million

TOTAL PLANS UNDER ADVISEMENT: 110

TOTAL PARTICIPANTS IN PLANS SERVED: 15,000