The relationship you have with your retirement advisor is a critical one. The retirement plan landscape has changed dramatically over the last few years and continues to change every year. Your retirement plan advisor should be playing an important role in helping you navigate your plan through these changes. We often hear plan sponsors say, "I think my advisor addresses everything they're supposed to do,” and “looking for a new advisor isn't worth the effort.”

Additionally, many plan sponsors think that if they have been doing business with their advisor for many years, they owe it to the advisor to keep them around. We agree that change can be challenging and maintaining relationships is important in business, but it doesn’t help your plan and your employees if you are not getting the best service possible and doing what's right for your organization.

The focus of plan sponsors today should be to provide a truly effective benefit for their employees, and advisors should be helping to deliver a comprehensive service model and work with you to create a targeted strategy with specific, measurable milestones. Your advisor should be setting a strategy that aligns your plan goals with deliverables that will help you achieve them. Here are some areas your advisor may be underservicing your plan:

You’re Advisor Isn't Sharing the Fiduciary Liability

One of the most concerning components of administering a retirement plan is taking on the fiduciary risk that comes with it. It's your legal duty under ERISA law to provide a plan that serves your employees' best interests, which involves taking on liability with everything from choosing which funds the plan invests in, to managing employee feedback or complaints. If your advisor is not assisting you with this fiduciary oversight, you may want to consider making a change.

They Aren't Providing Guidance on Plan Design and Oversight

The COVID-19 pandemic caused many plan sponsors to stop and review their plan design and oversight responsibilities. Employer-sponsored 401(k) plans are complicated, and in times of uncertainty, there's an array of core services that advisors provide to employers and employees.

At least annually, your advisor should review with you the plan's design and its provisions to ensure they match how you operate the plan and your organization's goals. If you do make a change to your plan design or integrate new options such as auto-enrollment, your advisor should walk you through this process to ensure you are meeting compliance requirements and that your employees understand any plan changes.

Financial Wellness Program is Lacking

With the right advisor, employee education and custom financial wellness programs can be taken to a different level, and it can make a difference in both savings rates and retirement readiness. The pandemic made many employees uncertain about how to best manage their accounts. Experienced advisors provided various guidance opportunities to employees through virtual group sessions or one-on-one discussions on how to best manage their accounts.

Confusing Fee Structure

Plan costs cover everything from fund expenses, to recordkeeping, to asset management, and advisor compensation. Many of these costs are covered by the plan and its employees, which reduces their investment earnings and, subsequently, retirement savings. It's important to make sure fees and expenses are both necessary and priced fairly to ensure you're providing the best benefit to your organization and its employees. Plan fees should be very transparent to the plan sponsor and participants. Your advisor should be helping you understand your plan fees and helping you identify potential solutions toward consistently managing them.

The good news is that you don’t have to do it alone. Talk to a Wealth Enhancement Group advisor to find out more about how you and your business may benefit from working with a Registered Investment Advisor fiduciary.


This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal or investment advice.

Brian Gregov

Brian Gregov

Director, Retirement Plan Consulting

CPFA, AIF®, QKA Brian leads a highly qualified team and oversees the retirement plan governance and fiduciary responsibilities for his clients, along with their administration, operations and design. He has more than 20 years of broad experience working in retirement solutions, including managing plans for large, multi-hundred-million-dollar corporations as well as small businesses. Brian supports his clients by designing customized retirement plans that are focused on specific goals and...Read More