Managing a Practice

Managing a Practice

Managing a Practice covers the ways that advisors can profitably and successfully run their businesses. It includes practical topics like business systems, advisor fees and client services, as well as professional development and growth strategies. Also covered are overall industry trends and ethics and compliance, as well the various service providers and vendors that advisors partner with to build, grow and manage their practices.

Are More Americans Covered by Company Sponsored Retirement Plans Than We Think?

An Investment Company Institute study released last month, “Who Gets Retirement Plans and Why, 2011”, found that nearly three-quarters of those likely to save for retirement have access to a retirement plan through their employer or their spouse’s employer. Of that group, 93 percent participate. And according to the September edition of “Beyond the Numbers,” a U.S. Bureau of Labor Statistics monthly publication, access to retirement plans differs significantly by occupation, union status and wage level, among other characteristics. For example, the 78.7 million people without access to their own work-based retirement plan includes 61.1 million private-sector workers — but 12.7 million people in this uncovered group are self-employed and 153,000 say that they work without compensation of any type. Of the 52 million people who work for companies that don’t sponsor retirement plans, just 9.9 million, or 19 percent, don’t have access to a plan through their spouses’ employers, the ICI study found.   Read More

Quick Reference Guide for Participant Notices

Plan sponsors are required by the IRS and/or the DOL to provide notices to eligible employees and plan participants at specific times of the year related to the status of the plan or the participants’ accounts. A list from by Baden Retirement Plan Services (an Ascensus company) provides a quick reference — not a complete list — of notices that a plan sponsor should provide to participants.   Read More

Borzi: Public Plans Should Follow Private Plan Disclosure Rules

At the annual National Association of Government Defined Contribution Administrators (NAGDC) conference in San Diego, Phyllis Borzi, head of DOL’s Employee Benefits Security Administration, opined that public plans should follow private plan disclosure rules even though she has no jurisdiction over them. Borzi cautioned administrators about people trying to separate plans from their money and the difference between lifetime income and annuities — all while mourning the demise of (and attack on) DB plans.   Read More

Women Eclipse Male Wealth Managers in AUM

Female wealth managers now manage an average of 5% more assets than their male counterparts, according to Fidelity’s 6th annual Broker and Advisor Sentiment survey. Behavioral finance research shows that women take less risk than men and are more realistic, while men tend to be more confident and optimistic. Women make up less than 10% of plan advisors, so advisor firms and broker dealers may be wise to recruit women to help plan sponsors and their participants with financial planning — not only to distinguish themselves but also to gather more assets.   Read More

Obama or Romney? Red or Blue? What’s the Likely Impact on Advisors?

As you may have heard, there’s an election coming up in about a month. In a video shot just before the first presidential debate, NAPA’s Executive Director and Washington insider Brian Graff explains his take on the presidential campaign as it enters the stretch run, the likely political balance in the House and Senate, and what it all may mean for plan advisors.   Read More

408(b)(2.0) – The Next Steps for Plan Advisors

Finally, after months — perhaps years in some instances — of preparation, diligent providers of services to retirement plans have now completed their disclosures in satisfaction of ERISA Section 408(b)(2) and they lie in the hands (or at least the inboxes) of the responsible plan fiduciaries. The final deadline, July 1, has passed. While that milestone may merit a collective sigh of relief, the work is just beginning for the service providers that delivered the disclosures and the plan sponsors that received them. It is critical that both develop sound protocols to maintain compliance and to be prepared for what lies ahead.   Read More

Proactive Advisors Can Leverage Plan Participant Concerns

Participants’ concern about their retirement is growing, according to the 4th Annual 2012 DC Participant Experience Study by KK & Company and Greenwald & Associates. To address that concern, participants prefer more proactive steps to increase their retirement readiness and provide them with more analysis. Almost half of participants feel they are behind schedule on saving for retirement, and three in five wish their employer did more to educate them about their retirement plan. Advisors that provide hands on education and advice are better positioned to address these concerns and win new business.   Read More

Advisors Need to Help Clients Focus on the Right Variables to Improve Outcomes

For decades, the defined contribution industry has focused on the performance of individual funds at the expense of other plan metrics. In a recent white paper, W. Van Harlow, Director of Research, Putnam Institute, analyzes a series of variables — fund selection, asset allocation, portfolio rebalancing, and increasing deferral rates — to determine which factors may have the greatest potential impact on an individual’s portfolio. Though it may seem intuitive that deferral and asset allocation have a greater affect than fund selection, the analysis may be helpful to show clients where to focus attention and resources.   Read More

Coming Pension War Makes Election Look Tame

Mitt Romney’s reference to the divide between the 47 percent of citizens who don’t pay income taxes and those who do may not be as important the pension divide, between those few who have a guaranteed cushion in the form of defined benefit pensions. How the candidates address this divide, cultural as well as political, is crucial, far beyond November.   Read More

401k Heaven Redefined

Nearly 10 years ago, when there were 120 national 401(k) recordkeepers, it was easy to guess which ones were likely to exit the market next. The hard question was which ones would never exit because of the assets and participants under management built by brand and distribution who are in “401k Heaven.” Today, with fewer than 40 national recordkeepers remaining, the definition of 401k Heaven needs to be expanded to those that are competitive and would surprise most of us if they sold or exited. Fewer than 25 of the nearly 40 recordkeepers, or about 60%, can survive the coming “nuclear winter” in the 401(k) market.   Read More

Six Good Websites for Research

NAPA Net Conductor Nevin Adams highlights his favorite websites that advisors can use for research and statistics, including EBRI, The Bureau of Labor Statistics, IRS, DOL/EBSA, The Ballpark E$timate and American Savings Education Council. While it’s difficult for an advisor to be a thought leader, citing relevant and useful statistics to clients, as well as leveraging thought leaders like Nevin, have a better chance of retaining clients and winning new business.   Read More