Have you lost that loving feeling for your retirement plan adviser? Can you rekindle that old flame or is it time to move on? With Valentine’s Day approaching, it’s a good time to take stock. The following five questions should clarify whether to work on the relationship or consider a change.
1. Does your adviser put the “bored” in the boardroom?
Sometimes even the best advisers slip into a routine that just feels repetitive. It may be hard to tell whether yours is out of touch with the most advanced service offerings in the market, or whether you might need to just shake up the routine. For instance, ask what they might do for you if you were a new client that they’re not be doing now. Who knows, they may be excited that you asked.
2. Is your adviser on autopilot in committee meetings?
This one is a touchy one. Sometimes the adviser does a lot of the talking because their clients have just come to confidently rely on them to lead the process. They’ll come in each quarter, read the report, hit all the bases and write up the minutes. That may work for some sponsors, but some advisers simply don’t engage with their clients beyond assessing needs and even assume understanding of the key information they routinely review. Worse, others outright don’t listen, don’t let their clients get a word in edgewise and don’t follow up.. Only you know whether your communication is strong or not.
3. Have those quarterly reports kept their figures?
There have been many advancements in plan reporting in the last five to 10 years. The best advisers delve deep into participant outcomes, employee communications, and plan design ideas. Reports should reflect that. And about those investments — pretty charts and graphs are great but does the report actually spell out the adviser’s recommendations in plain speak English? If not, they should.
4. Good partner or a gold digger?
A great advisory relationship should provide independent verification that all of your plan fees are competitive in today’s market. Of course that includes recordkeeping and investment costs, but such verification should also scrutinize advisory expenses and fee structures as well. Most organizations benchmark, RFI or RFP their recordkeeper fees every three to five years at least. The best advisers lead this process to help you meet your responsibilities. Notably, your adviser’s fees need to be independently validated as well. That’s where we see the biggest blind spot in adviser relationships these days.
How often do advisers ask you to evaluate them? Shockingly not often enough.
5. Time to play the field?
If it’s been five years or more since you investigated the market for advisory services, it’s time to start asking: how satisfied are you? While it’s true that many fiduciaries are just as enamored with their retirement advisers as they were the day they hired them, others admit that they’ve been together so long that they really “don’t know what they don’t know.” Others report levels of dissatisfaction ranging from feeling a little frustrated to being completely over it.
Consider that you and your fellow fiduciaries may not even be the people that ran the search for your current adviser in the first place. There is no hard and fast rule about how many years should go between searches, but if it’s more than five, your level of satisfaction and your confidence in that satisfaction should dictate how soon you check the market. And if you are coming up on 10 years or more, it may be time to validate your choice — regardless of your love for them.
Whether you are still head over heels in love, going through some ups and downs or your relationship is on the rocks, keep in mind that plan sponsors have a fiduciary duty to regularly assess their service providers whether there is a high level of satisfaction or not. Periodically running an RFP is a good way to get the love you — and your plan — deserve. Like Match.com for advisers, an RFP will help you play the field by introducing you to new candidates and contemporary services to compare your existing relationship to. At the very least, the process will help you validate what your current adviser is doing right and identify what they could improve upon, thereby allowing you to renew your vows.
For some of you though, finding a better match may be the way to go.
