PLANADVISER - March/April 2018 - 13

How Do Your Clients'
Plans Stack Up?
Nearly six years after the Department of Labor began
enforcing new fee disclosure rules for retirement savings
plans, some plan sponsors still struggle to understand
exactly how much they're paying and whether they're
getting good value for their money. Advisers-supported
by the right partners-can provide the answers.
T
here's little doubt that the fee disclosure rules introduced
by the Department of Labor have had a significant impact
on the retirement plan market. Many plan sponsors have
seen their fees and expenses go down, both for investment products
and administrative services. They've also seen confusing
and often expensive pricing structures replaced by more transparent,
lower-cost, fee-based arrangements. Yet some sponsors
still find it challenging to determine the true cost of their retirement
programs, especially in cases in which fees are bundled
into insurance wrappers or embedded along with other costs in
mutual fund expense ratios.
" The fee disclosure rules have accomplished much of what
the Department of Labor intended, " says David Musto, president
of Ascensus, a plan provider that has been recognized for delivering
exceptional value for cost. 1
" Still, we're finding even today
that our adviser partners often ask our sales and service teams
to help them better explain and compare plan administration
and recordkeeping fees to plan sponsors. "
To help advisers clearly illustrate the value of their clients'
plans, Ascensus routinely benchmarks its fees and disclosure
practices against those of its peers. The firm has also developed
tools and services to help advisers do the same for themselves,
and to educate their plan sponsor clients about getting the most
for their money.
" It's become a very competitive environment in terms of
who can provide the best value for what they're charging-
whether you're talking about an adviser or a service provider like
Ascensus, " Musto says. " As an organization, we pride ourselves
on our ability to help clients simply interpret the value that their
retirement plan delivers. "
Ascensus developed a web-based tool-available at
alwayshaveaplan.com-that allows advisers to quickly run a
custom pricing comparison for their clients' plans based on
factors such as plan assets and participant count and how the
plan pays its recordkeeping fees. The tool can demonstrate how
a flat-dollar, participant-based approach to recordkeeping fees
can reduce costs and boost a plan's market value over time-a
message plan sponsors appear to be taking to heart.
In 2004, Ascensus became the first independent recordkeeper
to introduce a scalable, fee-based retirement platform
for advisers and their clients. In 2017, fee-based plans represented
90% of new sales on the Ascensus platform.
Meanwhile, Ascensus
assists
advisers
in
determining
whether their own fees are competitive by updating them annu1
2017 PLANADVISER Retirement Plan Adviser Survey, " Top-Rated Defined Contribution (DC) Providers. "
www.planadviser.com/research/2017-planadviser-retirement-plan-adviser-survey/2/
SPONSORED SECTION
David Musto,
President of Ascensus
" We pride ourselves on our
ability to help clients simply
interpret the value their
retirement plan delivers. "
ally on trends in adviser fees, drawing on data from the more
than 25,000 fee-based plans that the company administers.
To further help advisers and their clients, Ascensus gives
advisers the flexibility to establish upfront, tiered fee schedules,
with adviser fees that go down as plan assets hit certain
pre-established break points. Initially popular in the larger-plan
market, Musto says this approach is now migrating downmarket,
too.
Ascensus also suggests taking advantage of the growing
availability of low-cost institutional shares from fund companies,
including zero-revenue fund options. Currently, Ascensus
offers more than 5,500 zero-revenue fund options and more
than 6,000 additional low-cost investment options, both of
which are already winning favor with many plans.
What else can advisers and plan sponsors do to maximize the
value of their retirement savings plans? Musto suggests thinking
about tax implications when deciding on how they pay plan fees.
" Many small business owners have recently completed their
tax filings for 2017, and maximizing tax advantages for next year
is top of mind, " he explains. " It's important to note that sponsors
who write a check for recordkeeping services under a fee-based
structure receive the benefit of a business tax deduction for that
expense. Clearly, that's not the case when fees are wrapped into
an asset-based charge. " n
To run a custom pricing comparison for your clients,
visit alwayshaveaplan.com.

http://www.alwayshaveaplan.com http://www.alwayshaveaplan.com http://www.planadviser.com/research/2017-planadviser-retirement-plan-adviser-survey/2/

PLANADVISER - March/April 2018

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