AT LAST WEEK'S DCP Institute hosted by 401kExchange and the Boston Research Group, 125 advisors, 15 Broker Dealers and 18 providers gathered in Palm Beach’s PGA National Resort & Spa to discuss “How to Build and Manage a Retirement Practice.”  Expert speakers included Fred Reish*, Mike Henkel* (former President of Ibbotson), Charlie Epstein* (The 401kCoach) and Warren Cormier* (President of Boston Research Group).  Each of these renowned experts brought unique insights and opinions on key topics. 

All speakers focused on one theme – Participant Success. Advisors and providers who help participants improve their chances for a successful retirement (and can prove it) will have a huge competitive advantage.  Warren Cormier pointed out that almost all non-human touch services like record keeping and websites have been commoditized and that levels of satisfaction for everything except employee education and investment performance are at all time highs.  Fred Reish said that 70% participation rates are good for savings plans but not for retirement plans and that deferral rates should be 12% or higher.  The reasonableness of expenses should be based on results not effort.  Warren noted that participation and deferral rates do not vary significantly among record keepers.  Charlie Epstein coached advisors to focus on helping plans bridge the “participant gap” or what participants have compared to what they will need to retire.

Mike Henkel and Fred Reich each discussed an interesting concept – the personalized portable DB plan.  All agreed that asset allocation funds will become prevalent in K plans, which is not good for stable value funds or advisors who put their primary value on fund selection.  But someone has to monitor these funds and Mike Henkel suggested that asset allocation mangers might be guilty of self dealing if all underlying assets are proprietary.  Broker dealers asked providers to make their fees more transparent and help them with reporting sales and asset flows.  Fred Reish went so far as to say that transparency equals quality and that it is likely that the DOL will require advisors to disclose compensation and fees under proposed regulation 408(b)(2).  He also suggested that the PPA could be interpreted to allow plans to move current participants into asset allocation funds, not just new employees or those not participating, although there would need to be proper notification and opportunity to opt out.  Charlie Epstein pointed out that the entertainment industry would go out of business if clients did not have to pay until after the show yet many retirement advisors make that mistake.  Finally, and perhaps best of all, a panel of expert advisors (Al Cassinelli, Mike Montgomery, Jim Hageney, and Charlie Epstein) discussed how they built their practices as well as the challenges and opportunities ahead.

At 401kExchange, our goal is to not only discuss best practices but to actually provide the tools and services needed.  For advisors, our main client base, these services include:

• Business Development (Prospect Goldmine and Appointment Setting)

• Benchmarking services designed to help advisors close business (401kScout and FiRM Marketing Report)

• Vendor and Investment Due Diligence (401kNavigator and FiRM Investment Monitoring Report)
   

The next piece of the puzzle is training and networking which is why we created the DCP Institute.  Unlike other independent industry conferences which have become like mega flea markets, the DCP Institute is an opportunity for advisors, providers and broker dealers to truly network and discuss real issues with industry experts in a collegial, non-commercial setting.  To maintain this environment, the DCP Institute will remain small and manageable with invited guests only.  Thanks to all who participated to make this year’s event so successful.

* All comments in this article about each speakers presentation are 401kExchange’s interpretations only and may not accurately reflect the speakers’ beliefs.  All of the speakers PRESENTATIONS are available online.

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