TPAs and advisors can and should collaborate, argued Jeffrey Acheson, Chief Business Development Officer/Divisional President, Independent Financial Partners, at an Oct. 21 session of the ASPPA Annual Conference.
Acheson stressed the importance of “cross-pollination,” telling attendees, “People are best served by teams” and suggesting that it can be productive for professionals with otherwise divergent backgrounds and roles to “think of each other as in-source staff” and to “go to clients in a unified manner.” Said Acheson, “when it’s not in your sweet spot, bring in an expert. Establish a relationship in which you’re in-source with each other.”
“You can’t operate in a vacuum. There has to be a measure of trust,” as well as “proactive cooperation,” he said in response to a question from co-presenter Justin Bonestroo, Senior Vice President, CBIZ, regarding how best to be intentional with partners. He added that one needs to ask oneself if the relationship is just referring business to each other, or if it involves being in-source with one another.
And collaboration can bring value, Acheson indicated, and what you do, what you know, and who you know are critical. The latter is “where the real value comes,” said Acheson, adding that it is valuable if clients know that one can direct them to someone who knows the answer to a question if one does not. “Don’t talk about things you don’t know anything about. Know where the lines are,” he said.
Opportunity
Acheson stressed the opportunity offered by the small business sector, observing that 99% of U.S. businesses have less than 500 employees. “If you’re in the small business market, you’re in the right market,” he told attendees.
And how to identify opportunity? Acheson suggested that finding a successful retirement plan will lead one to a successful business and business owners with multidisciplinary needs. And he said that the best way to identify a successful plan is to look at a 401(k) plan.
Acheson also argued in favor of paying attention to small plans. He told attendees that 401(k) plans with under 100 employees — which comprise 90% of the market — are underserved. And so is the micro mid-market, which he said is underserved despite the fact that the typical engagement generates $5,000 to $50,000 in total annual revenue.
Acheson offered some tips on how to source potential clients:
- Cull data from Forms 5500; look for particular plan problems.
- Seek information from ERISA auditors; they know where issues are.
- Highly compensated employees who are frustrated can also represent opportunity.
He also suggested that information about K-1 earnings can be useful in identifying business opportunity and serving clients as well.
Looking Ahead
“The world for us is going to look different” five and 10 years from now, said Acheson. “It is going to change.” He added that “The next five years are about plan design,” and emphasized the importance of being collaborative.
“None of us is as smart as all of us,” said Acheson.
