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Leading the Way—Building in Productivity to Your Retirement Plan Business

Leading the Way—Building in Productivity to Your Retirement Plan Business

Advisors can prepare themselves now to scale their retirement business with an eye on profitability

The growth in the retirement plan market—especially the defined contribution (DC) space—represents a significant opportunity for today’s advisors. DC assets are expected to grow at a rate of 5% to 6% per year, while current projections place total DC public and private plan assets at more than $9.3 trillion by 2019.[1] 

But seizing this market opportunity in a way that helps advance the business and increase profitability will require advisors to keep productivity in mind. The most successful retirement plan advisors—those who can scale and deliver better retirement outcomes for plan participants—are able master three key practices that result in greater efficiency and, in turn, growth. They include:

Putting Standardized Processes in Place

In a recent FPA survey, 51% of advisors indicated that clearly defined and standardized processes were the best ways to improve efficiency.[2] When you look at successful retirement plan specialists, they have strongly defined processes concerning how they work with plan sponsors and plan participants. This process discipline helps to effectively position their business with the plan sponsor in terms of value and service fees charged.

While the specifics may vary, key commonalities include:

  • A comprehensive written service plan—Start with an annual relationship review that outlines goals, services and success measures. Consider and document the frequency with which you will meet with plan sponsors. How often will you assist in the review of the plan’s investment policy statement, the plan’s investment menu or its performance? What is your strategy for working with plan participants? How frequently will you conduct enrollment meetings or educational seminars? Will you provide support communications for plan participation or even investment education materials? Make sure you clearly communicate your role as advisor.
  • A well-defined fiduciary governance model (whether acting in a 3(21) or 3(38) capacity)—By creating and implementing a standard, scalable approach to plan investment monitoring and investment portfolios, you will simplify and streamline the decision making process. This will help reduce risk for plan sponsors and help position participants to achieve better retirement outcomes.
  • Time-management tools and standards—Hire retirement plan specialists or leverage plan service providers who can add expertise in plan design. Delegate administrative tasks and have other members of your team work with plan participants. Better delegation and time management can free you up to spend more face time with clients.

Leveraging Integrated Retirement Plan Solutions

More and more, the most successful retirement plan advisors opt for integrated solutions. These solutions provide advisors access to recordkeepers, investment solutions, retirement plan tools and other resources that are critical to running a retirement plan business. When advisors are able to offer retirement solutions through a single, integrated platform, they can significantly streamline servicing. 

Leveraging an open-architecture platform with access to a broad universe of investment options, as well as tools for creating and incorporating model investment portfolios, can also help advisors better tailor plan investment approaches to specific plan sponsor and participant needs.

Further, by gaining access to a range of retirement plan recordkeepers and integrated tool solutions, advisors are better positioned to effectively sell, service and manage retirement plans. Using an integrated solution with a single point of access allows advisors to spend more time with plan sponsors and participants and consume less time with administration and operational tasks.

Managing the Growth

Scalability is the final key for success. More clients can mean more work. The most successful advisors segment their retirement plan clients by revenue, assets or type of services provided to clients. This way, they can focus on providing more customized solutions to their most profitable clients and emerging clients.  The key is to develop standardized and repeatable core processes and communications that are specific to each client segment, eliminating the need to reinvent the wheel each time a new retirement plan client is acquired. Segmentation of services between the plan sponsors and participants can also be beneficial for advisors when justifying fees, as it helps to more clearly illustrate the advisor’s value.

The retirement plan market is expected to continue on its current upward trajectory for the next several years. By putting in place best practices now, advisors can prepare themselves to scale their retirement business with an eye on profitability, and position themselves competitively for the growth to come.


[1] Cerulli Associates – Retirement Plan Markets 2014

[2] FPA: Doing More with Less, 2014


Marc Caras is a Director for Pershing, a BNY Mellon company. In this role, he oversees the strategy and development of its retirement plan market strategy. This includes Pershing’s Retirement Plan Network, an open-architecture platform for the sales, service and custody of retirement plans.

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