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LPL Takes on Participant Advice, Blind Squirrel Conundrum

At this past weekend’s LPL Retirement Partner Group meeting, 350 plan advisors gathered in Colorado Springs, including many of the 105 advisors recruited in 2013. Bill Chetney, SVP and group leader, said that while advisors have changed the DC and retirement market, there’s a long way to go. Claiming progress by advisors to open fund menus, drive down pricing and help plan sponsors manage their fiduciary liability, Chetney told the group that helping participants manage their retirement portfolio to and through retirement is the next and perhaps most daunting challenge.

LPL is committed to bringing customized, personal advice to participants through their Worksite Financial Solutions program, Chetney indicated. The program integrates advisors, call centers and technology to onboard, educate and advise workers throughout their working lives and through retirement.

Adoption of online financial advice has been low and most advisors do not have the resources or will to be able to offer a cradle-to-grave solution. Providers, especially record keepers, must be integrated into the system, which takes resources. Some providers seem more interested in capturing rollovers themselves. Changing the behavior of advisors, participants, plan sponsors and providers is difficult, but LPL seems committed to providing what they call coordinated, unbiased advice.

Chetney also highlighted LPL’s Sync program, which tries to match up plan and retail advisors in the same geographic area to share opportunities. Many plan advisors don’t do wealth management or rollovers yet have tens of thousands of participants; most retail advisors don’t work on DC plans but may have relationships with corporate decision makers. Bringing the two together seems logical. But again, changing human behavior is difficult, as is building trust.

Both the Worksite Financial Solutions and Sync programs are ambitious, but they hit on two of the most crucial issues in the DC industry: providing customized advice to all participants and bringing more experienced plan advisors to plan sponsors. The two programs are the reasons LPL bought NRP almost three years ago and the reasons why NRP chose LPL as the buyer. As Chetney put it, “the devil is in the details.” But the goals are clear — and ambitious.

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