PLANADVISER: Tell us about your practice and how you and your team members got into advising retirement plans.
The J&R Group of Merrill Lynch: We are a tightly knit group of 10 professionals working together to support the needs of our clients and their constituents. Our two senior-most partners, Jim Radler and Tim Jenkins, merged their wealth management practices together in 1994 for the purposes of attracting larger, institutional-type clients. This started with advising small- to mid-size businesses on their 401(k) plans and branched out into working with larger corporations on full-scale benefit programs.
PA: What is your mission statement?
J&R: To partner with plan sponsors in the evaluation, design, and delivery of world-class employee-focused retirement plan solutions, one organization at a time. We achieve success by establishing education, communication, and investment programs that help each individual employee to reach his or her financial goals.
PA: What do you consider the most significant challenge facing retirement plan participants? Facing retirement plan sponsors? Facing retirement plan advisers?
J&R: For retirement plan participants, the biggest challenge is complexity. The process of learning about and signing up for your company’s retirement plan can be burdensome and daunting. It is our job as advisers to help simplify this process. We do this by encouraging recordkeepers to improve their technology, by stressing the importance of automated programs wherever possible, and most importantly, by working directly with participants to ensure the completion of important processes.
Not a week goes by when we don’t help a participant to process a rollover into (or out of) their company’s retirement plan. Rollover processes can be complex and confusing, so we like to offer our assistance to every individual participant who needs our help.
For retirement plan sponsors, the biggest challenge is time. Plan sponsors are increasingly burdened with regulatory challenges and other business operations which take up more time than they have in the past, which leaves very little (or no) time to address their retirement program. We do everything that we can do to keep our interactions brief and relevant, without sacrificing the quality of our work. Our plan sponsor clients appreciate the fact that we are available and ready whenever they need us.
For retirement plan advisers, our biggest challenge is profitability. As industry-leading advisers, we all want to do great work for every company, no matter how large, small, or complicated. Unfortunately in an era of shrinking margins, we need to appropriately “pick our spots” to identify the clients who are best suited for our business, otherwise we become diluted and no one gets the service that they expect or deserve.
Advisers need to continuously define their target market, and where they identify clients who are not an ideal match, advisers need to work to find a better solution for that client rather than leaving the client without the appropriate service people in place.
PA: Describe any particularly initiatives you have led with your customer base in the past 12 months (investment or education or plan design or communication).
J&R: We have gone to great strides to provide direct education to our clients’ employees. While many other advisers will exclusively use the recordkeeper to handle employee education, we have taken a different approach with our business historically, and it has worked to help us positively impact our clients and to differentiate ourselves form other advisers.
Over the past year, we have worked to expand our educational offerings to include more broad “financial wellness” content rather than the usual “how to enroll”, “401(k) investing basics”, and “the importance of saving”. We find ourselves talking more to plan participants about topics such as college planning, medical expense budgeting, and understanding Social Security.
PA: As a retirement plan adviser, what do you take the most pride in?
J&R: We take pride in the satisfaction of our clients as well as our co-workers. We serve many constituents. Most notably, our constituents are our clients, who we value tremendously and strive to express this importance throughout every step of the relationship.
Secondarily, our constituents are our co-workers, including our own team’s staff members as well as our colleagues. We work hard to be correctly viewed as a good team to work for and a good team to work with. Our staff needs to be happy, otherwise the work suffers, and our colleagues need to be happy, otherwise they will stop introducing us to their valued relationships.
We feel fortunate that staff turnover is consistently very low, staff members have continually worked their way up the ladder within our team, and colleagues continue to refer their clients to us for institutional retirement and investment consulting needs.
PA: How do you grow your business? What changes to your practice or service model are you planning for 2017 and beyond?
J&R: We are proud to say that our number one source of new business is introductions from our colleagues at Merrill Lynch and Bank of America. We have worked hard to make our colleagues comfortable in introducing their clients to us, as a way for them to expand their client relationships and to be able to leverage our expertise. We take these relationships extremely seriously and we work diligently to convey the appropriate reputation for our team as professionals who can be relied upon.
An additional source of new business comes from clients who get to know us through our work with their organization, and then leave to join another organization. We are proud of the fact that many of our new relationships have stemmed from existing relationships with finance and human resources professionals who leave a client, join another company, and then call us up to ask us to get involved with their new company. There is no better endorsement of the quality of our work.
BUSINESS AT A GLANCE:
Plan assets under advisement: $1.4 billion
Median plan size (in assets): $17 million
Total plans under administration: 210
Total participants served: 40,000