OVER 700,000 QUALIFIED plan participants with balances of $100,000 or more will take distributions from their plans this year¹.  These distributions will total approximately $315 billion¹!  What percent of these distributions are coming out of the plans that you have in your book?

Capturing these distributions via rollovers can be a tremendous way to grow your overall business and strengthen existing relationships.  Plan participants who have recently left their jobs are looking for assistance more than every before.  This is especially true of participants with larger plan balances.  56% of participants with balances over $250,000 used an advisor to assist them deciding what to do with their retirement plan money¹.  Retirees, who tend to have higher average plan account balances, sought the assistance from an advisor, financial planner or stockbroker 76% of the time².  For plans that you have a relationship with, you can have a distinct opportunity to meet the participants’ needs for assistance and help retain assets.

It is probably no surprise that some advisors are much more successful in retaining these assets than others.  The key to success in capturing these assets is having a reliable and efficient process.  The first step is to talk to the record keepers that you work with to understand the services they provide for terminated or retire participants.  Determine how the record keepers can customize their processes to save you time in the asset retention process.  For example, some record keepers will automatically send pre-filled Rollover IRA applications to newly terminated or retired plan participants on your behalf.  Further, record keepers can send you a report with the pertinent information on participants leaving the plan to allow you to follow up with them efficiently.

The key is creating a process that you can maintain over time to contact participants with money in motion.  By understanding how much money maybe leaving your clients’ plans, you can determine how much time (and money) you want to invest in retaining these relationships.  You may decide to hire an assistant to work with these participants to take advantage of this rollover opportunity.

By mapping out an efficient, ongoing process, we believe you should be able to retain the plan assets that you helped participants invest in the first place.

¹ Brightwork Partners DQP 2 Study – 2006

² LIMRA – The Pension Rollover Market – 2006

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