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401(k) Real Talk Transcript for March 6, 2024

Transcript of Episode 96 of 401(k) Real Talk.

Greetings and welcome to this week’s edition of 401k Real Talk. This is Fred Barstein contributing editor at’s RPA omnichannel and CEO at TRAU, TPSU & 401kTV—I review all of last week’s stories and select the most important and interesting ones providing open honest and candid discussion you will not get anyway else. So let’s get real! 


A court has ruled in favor of the defendants on the much-anticipated lawsuit brought by participants in the Wood 401k plan represented by Jerome Schlichter’s law firm involving flexPATH.

Citing proper due diligence by the plan and value added by flexPATH that deploys multiple risk glidepaths within each of their TDF series, the court ruled for the plan sponsor and flexPATH who more than justified the 338 fees paid to them. NFP, which had owned flexPATH and divested last year, was the plan’s advisor and was named in the lawsuit initially but was quickly dropped. Ironically, the plan eventually replaced the flextPATH TDFs in favor of Vanguard.

Advisors acting and being paid on the growing number of Advisor Managed Accounts will breathe a sigh of relief but questions still remain about fiduciary advisors recommending propriety products and services though 338 services seem clearly outside the scope of that issue.


The question is not whether but how AI will affect DC plans, participants and providers with the CEO of the CFA Institute, Margaret Franklin, providing some examples. She noted that AI analyzing terabytes of data-finding patterns may be able to improve asset allocation.

Other opportunities include performing routine and repetitive tasks, preventing fraud and hacking of participant accounts, and modeling behavior.

Bottom line: firms effectively deploying AI will have a more productive staff, better services and products, and can improve outcomes.

Though we have come a long way since robo advisors promised to replace financial advisors, we still have a long way to go with AI with warnings about bad data skewing results as well as firms manipulating the underlying algorithms.


Financial wellness and employee communication and education are all the rage in DC plans and with benefits programs overall, but engagement is still pathetically low. But, before it can be improved, we need an objective way to measure it.

A benefits professional outlines how to measure engagement which they claim results in 59% lower turnover and 17% higher productivity.

Borrowing from the key performance indicators or KPIs which media companies use the ways to measure engagement include: Open rates, Click through rates, Page views, Read time and Video views.

They also recommend post campaign surveys, benchmarking, evaluation and taking action based on what’s working and what’s likely to be most effective.

After behavioral finance, which dramatically improved DC plans through auto features, the next frontier is engagement which is hard to improve but needs to be strictly measured.


As the wave toward convergence of wealth and retirement continues at the workplace, there’s more evidence that retirement plan advisories are leaning in with a recent T Rowe survey claiming that 100% of these firms are providing wealth strategies to participants.

Though it seems a bit high, personalization is driving the move to managed accounts and other related services though serving the masses through personal financial advisors at scale is still a challenge. Regardless, the revenue opportunities, especially for the top 10% and HENRYs are too obvious.

The question is whether RPAs with access to tens of thousands of participants in plans they manage are better positioned than wealth advisors who are now able to integrate DC accounts in their planning through firms like Pontera and Future Capital and have begun to see DC plans as a way to find more wealth clients.

Regulators and law firms are watching closely as conflicts will inevitably rise and will wealth advisors become ERISA fiduciaries if they are paid out of plan assets?


Over 20 years ago, some of today’s top retirement plan advisors built their business on fiduciary principles while helping plan sponsors reduce record keeping fees. While it took some prodding to get plans to conduct record keeper RFPs because most claimed to be happy, the results have been much better service at a lower price point and fewer providers.

All of which is likely to happen for RPAs who have trained their clients well but also likely more slowly than with record keepers and investments as plan sponsors wake up. Read my recent column about how and when this movement will happen.


So those were the most important stories from the past week. I listed a few other stories I thought were worth reading covering:

Please let me know if I missed anything or if you would like to comment. Otherwise I look forward to speaking to you next week on 401k Real Talk.


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