PLANSPONSOR - August - September 2022 - 20

PROVIDER RELATIONSHIPS |COVER STORY
" Many plan sponsors are very insular,
so they really don't have a sense of
where the market's at in terms of
pricing and market trends, or what
they should be looking at in terms of
their service provider relationships. "
its employer match and vesting schedule stack up against other
businesses'. In general, plans with an adviser tend to have richer
features, such as match options and automatic enrollment, and
more investment choices, a Morgan Stanley at Work report states.
Plan sponsors that lack the knowledge, time or wherewithal
to manage the plan on their own should bring in an adviser,
says Robin Credico, defined contribution practice leader, North
America, at WTW in Las Vegas. " Whatever the cost is, it's likely
going to benefit you, and your results will
outweigh the costs. It's just good governance, "
Credico says.
Industry Insight
Because advisers work with many
different plan sponsors, as well as with
vendors, they can be a valuable source of
information on best practices and offer
insight into industry trends of which
plan sponsors may be unaware. They
can also evaluate the sponsor's current
providers to point out whether a better
option may exist.
" It's a benefit to plan sponsors to
bring in an outsider's perspective on
where the market stands, " says Martin
Schmidt, principal, MAS Advisors in
Chicago. " Many plan sponsors are very
insular, so they really don't have a sense
of where the market's at in terms of
pricing and trends, or what they should
be looking at
in terms of their service
provider relationships. "
Those trends might speak
to
managed accounts, to the viability of
introducing environmental, social and
governance investing options into a
20 PLANSPONSOR.COM August - September 2022
plan, or to innovations within target-date
funds, Schmidt says. He adds that the
adviser is the " eyes and ears " of the plan
sponsor within the industry.
Such expert insight is among the
most important things a plan adviser
can bring to the relationship with a plan
sponsor client, Holgate says. " The fiduciary
and plan documents are important,
but ideas are the secret sauce. "
Start the Search
As with any other provider search, plan
sponsors may use a tailored request for
proposals to solicit information from plan advisers about the
types of services they provide and how they would help the plan
achieve its specific goals. One place to start when conducting
an adviser RFP is the adviser-search RFP questionnaire template
created by the Retirement Advisor Council.
Even if plans choose to not go the formal RFP route, it is
helpful for the plan committee to invite several candidates in
to interview for the role, says Tim Kohn, head of DC services
What Advisers Add to the Plan
At least 85% of plans with a dedicated financial adviser offer
investment choices such as target-date funds, exchange-traded funds
and company stock options to the participants, and plan features
including automatic enrollment, an employer match and match
options-i.e., elective and nonelective.
Advised Plan Offerings
Investment choices
Automatic match
Match options
Automatic enrollment
Automatic escalation
Profit-sharing component
Small Midsize
85%
Large Enterprise*
92% 92%
78% 77% 83%
73% 76% 74%
61%
62% 78%
57% 70% 68%
47% 59% 64%
*More than 3,000 employees.
Source: Morgan Stanley at Work, " The Value of Financial Advisors "
94%
81%
80%
86%
69%
58%
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PLANSPONSOR - August - September 2022

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