2019 RPAY – The Beacon Group at Morgan Stanley

If you ask advisers in The Beacon Group at Morgan Stanley, the biggest retirement challenge facing individuals is “staring down age 60-plus” and realizing they have not saved enough. In fact, this was the very reason Noel Wolfe, principal and corporate retirement director, began working in the financial services industry in 1997. Wolfe watched his mother raise two children on her own while working two jobs and attending law school, leaving her with no time or resources to get on track for retirement. As a result, she had to keep working and play savings catch-up into her 70s.

“Employees are expected now to pay for living expenses, a larger portion of health care expenses, day care needs, college needs, elder care needs and retirement,” says Wolfe, who with the rest of the group is based in Blue Bell, Pennsylvania. “It’s a difficult nut to crack, and we, as an industry, don’t provide as much holistic guidance to help.”

In cases where an employee is nearing retirement age and has not saved enough, The Beacon Group focuses on the actions that can be taken now to improve the situation, as well as options for rethinking retirement, Wolfe says. If the employee is unable to make a large enough jump in contributions to get on track for retirement, the adviser may use the firm’s voluntary contribution accelerator, with the employee saving more each year until the retirement goal is reached, Wolfe explains.

And sometimes the conversation turns to rethinking retirement, whether this is for the participant to delay it for a few years, work part time in retirement or consider his home equity as a potential retirement asset, Wolfe says.

To keep participants on track, The Beacon Group likes to focus on contribution levels, rather than investment selection.

“People tend to delay decisions, being simply overwhelmed and feeling they can catch up later,” Wolfe says. “Thankfully, the marketplace has evolved somewhat to put the focus on contributions, rather than spending time training employees to be savvy investors.”

To that end, personal consultations, automatic features and options such as target-date funds (TDFs) are critical, he says. Employees who prefer little interaction benefit from raising automatic enrollment to 6%, with increases up to 10%. Other employees, however, prefer personalized attention from the adviser and a plan for how to keep focused on saving, Wolfe says.

Wellness planning is one way to help employees do this, which is why The Beacon Group offers seminars about budgeting, debt management, college savings, Medicare and Social Security. The practice offers Morgan Stanley’s LifeView financial planning tool, which includes testing for sequence of returns, detailed health care spending in retirement and Social Security optimization.

The Beacon Group has worked with some employees for over 20 years and takes pride in seeing the retirement readiness these people have achieved through the relationship. The group seeks plan sponsor clients that are serious about helping their employees retire, rather than just checking the box that they offer a plan, Wolfe says.

“This creates high advocacy from senior workers in any company’s workforce,” he says. “You create some great cheerleaders just by doing your job and carrying your responsibility with serious intent, whatever you are doing.”

Plan sponsor and employee appreciation for its retirement plan services is one of the group’s keys to organic growth, as the firm does not engage in typical marketing or subscribe to prospect lists. When a human resources (HR) employee switches jobs, that person often takes The Beacon Group along, Wolfe says. —Corie Hengst