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We met once, now what do I talk about?

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One of the most common concerns we hear from advisors who specialize in retirement plans is: how do I sustain momentum after a successful first meeting with a client?

While many advisors have an established blueprint for the first meeting, they often want new compelling ideas for the subsequent meetings. To help, BMO Global Asset Management has compiled data from several leading industry surveys into one easy to use guide – DC Conversations.

The graphs and data from DC Conversations can provide ideas for more productive conversations – particularly for the quarterly or annual review meetings that focus around certain industry issues and plan fees or expenses.

 

Industry specifics

For review meetings, plan sponsors are often interested in how their plan compares to other competitors in their industry. Advisors who understand the plan sponsor’s industry challenges and norms can have more detailed conversations focused on precise needs rather than broad market trends.

For instance, the participation rate in employer retirement plans vary from 70% in the wholesale and retail trade sectors to 76% in health care and 84% in construction.

participation rate by industry

Deferral rates and average account balances can also vary by industry. While overall deferral rates were 6.8% in 2015, they were 6% in wholesale and retail trade versus 7.4% in education and health. The average participant account balance in agriculture, mining and construction is $222,084 while the average in education and healthcare is $64,565.

Deferral rate by industry sector

Deferral rate by account balance

 

Fees and expenses

Apart from industry specifics, fees and expenses is a topic, plan sponsors often want to review and question. While a full benchmarking review is time-consuming and may normally be done on a regular annual review cycle, it can be helpful in mid-cycle review meetings to give plan sponsors perspective on their current fees and expenses relative to like-sized firms.

For example, the following chart shows large plans with more than $1 billion in assets have costs about 0.3% but can range between 0.14% to 0.51%. Costs for smaller plans with between $1 million to $10 million are higher, averaging about 1.2% with a range between 0.74% and 1.71%. The simple chart and quick conversation can help provide confidence in a structured review process around fees and expenses.

distribution of total plan cost

 

Continue your conversations

While topics of regular review meetings will vary, using these industry data points will help advisors have better conversations which will create better outcomes for plan sponsors and their participants. For more detailed information, check BMO Global Asset Management’s DC Conversations.

 

Download the full report - PDF and PowerPoint formats

With your download of 2017 DC Conversations, you will receive full access to the entire collection of charts and graphs to use in your own client meetings. To download the report, simply complete the fields below.

Thank you for your interest in 2017 DC Conversations: An industry assessment. We hope this is a valuable tool in your conversations with clients.

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We believe better conversations result in better outcomes. Let’s start a conversation today!

1 (844)266-3863

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