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UBS Debuts Program to Help Advisors Serve Small 401(k) Providers

Following moves at Morgan Stanley, the wirehouses are increasingly helping their advisors tap into opportunity among small and midsize plan sponsors.

UBS Global Wealth Management debuted a program in October that enables its financial advisors to serve small 401(k) providers, a market where wealth managers see opportunities and are looking for ways to capitalize.

The new Retirement Plan Manager program will help advisors serve smaller participant-directed defined contribution retirement plans with less than $5 million in assets, something they had not been able to do effectively before, Gene Silverman, an executive director at UBS Global Wealth Management, told 

The program was launched as part of UBS Retirement Plan Guided Solutions, a separate offering from the firm’s existing Retirement Plan Consulting Services program that has roughly 150 UBS advisors trained as institutional consultants working with about 2,000 large retirement plans with an aggregate of $85 billion in plan assets.

In the new Retirement Plan Manager program, UBS will be able to offer discretionary investment management services to employers as a fiduciary under ERISA Section 3(38), rather than as a so-called broker-of-record, which doesn’t share any fiduciary responsibility with plan trustees. 

Jim Hausmann, head of Corporate Solutions and Retirement Services at UBS Global Wealth Management, said a few factors led to creation of the new program. Although it’s now defunct, the Department of Labor’s retirement savings rule, and general sentiment toward the benefits of a fiduciary relationship with an investment advisor, have led more plan sponsors to choose advisors who fill that role.

Smaller companies also typically lack the staff and support to fill the fiduciary obligation to their retirement plan offerings themselves, and will look to third-party administrators or 3(38) advisors to fill that role, according to one recent study

In addition to gaining new business, UBS is moving more of its retirement plan business to the new platform. It is the broker-of-record for roughly $11 billion. One way the Retirement Plan Manager program differentiates from similar programs at competitors is that it works with a selection of recordkeepers, giving clients more flexibility, Silverman said. Converting recordkeepers can be a painful process for companies, making changes less likely, he said.

The ability to serve retirement plan providers will also open doors for UBS advisors, according to the company. Corporate executives or participants at the plan sponsor could become individual clients, or current clients who own small businesses could be a good market for the UBS retirement program.

Other companies see similar opportunities in the retirement plan market. Last month, Morgan Stanley Wealth Management said it made improvements to its Financial Wellness Program for plan sponsor employees, including a new portal to a 12-question assessment tool that scores employees on their financial well-being. 

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