Business at a Glance as of 12/31/22
- Plan assets under advisement: $1.1 billion
- Median plan size (in assets): $6.5 million
- Plans under administration: 176 qualified plan clients and 213 adopting employers in the isolved Pooled Employer Plan
- Total participants served: 15,112
PLANADVISER: Tell us about your practice and how you got into advising retirement plans.
Scott: I started in the business right out of college in Boston in 1995. At that time, 401(k)s were just starting to really take off, and employee education was a relatively new concept. I worked at State Street Global Advisors and focused on the large market, where I supported sponsors such as Boeing, Chevron, the State of Michigan and Kodak.
PLANADVISER: How is your team/process/structure unique? How has it evolved? Where will you be in five years?
Scott: We are a large plan consulting practice that brings professionalism, specialists’ skill set and fiduciary process to the smaller end of the market, as well as to our core market clients. Having a TPA division was the special sauce in the past and remains very relevant, but in addition, now we have aggressively moved into the PEP space to address this underserved but growing market.
PLANADVISER: As a retirement plan adviser, what do you take the most pride in?
Scott: We are still truly independent. We do not have a large personal wealth management practice; we do not do other benefits or have diluted ownership. We are a truly independent and bootstrapped consulting firm that does not have to modify our service model for investors; everything is done with the client interest as the core driver.
PLANADVISER: How do you grow your business? What changes to your practice or service model are you planning for 2023 or 2024?
Scott: The commitment and belief as we started to feel that the Secure Act was coming a few years back changed our approach. Today we are a 3(38) on two national Pooled Employer Plans and do direct adviser support to 213 underlying adopting employers. This growth is actually increasing, and we have a new PEP we will be “relaunching” in May. These have really been focused on bringing new sponsors and participants into the retirement plan space.
PLANADVISER: What challenges do you think the retirement plan industry faces and what role do you have in addressing and confronting those challenges?
Scott: Everyone wants benefits expansion. Auto-features work and, I believe, will eventually became a federal mandate for all plans (and obviously new ones as of 2025). But this will create a lot more consulting to reevaluate plan design and benefit models. All of this will happen at a time when fee compression remains a major issue. The PEPs, we believe, will be a much more cost-effective way to serve this market. In addition, we are expanding segmentation, trying to leverage more technology and video training.
PLANADVISER: Why do you feel that retirement plan advisers should get involved in the expansion of the DC retirement plan system to cover more types of employers and employees?
Scott: Everyone wants a massive plan with meaningful revenue on Day 1. But as we all chase and fight for those clients, the fact is that the market is well cared for and well handled. We believe that we are the primary advisory support for most of our participants. Most Americans need help, and [Washington,] D.C. is making it very evident that the avenue where they expect that help to come from is in the qualified plan arena. So revisiting models to play in this space is both opportunistic and essential.
PLANADVISER: What are the biggest challenges preventing the broader delivery of tax-advantaged retirement savings opportunities in the workplace, and how might these be solved?
Scott: Overcomplicating solutions is not the approach we want. There are many good ideas in ERISA and recent legislation like the Secure Act and Secure 2.0 Act. But it is often seen as confusing and burdensome to small business owners. This is worsened with so many plans being serviced by non-specialist brokers and benefit advisers. It would be nice to have more clarity on legislation from governing bodies such as the DOL and the IRS sooner. In addition, safe harbor choices should be expanded, and a national mandate would level-set and take away the state mandate confusion.