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What’s on the Retirement-Plan Menu?

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All experienced advisors know that asking great questions to their best clients can uncover more assets to manage. With the stock markets now off of the recent highs, great client questions could not come at a better time.

This is the third in my series of articles on how advisors can begin to manage their client assets in company retirement plans. The series of articles began here.

The Retirement-Plan Menu

First, ask your best client if he or she would be interested in a second opinion on the menu of mutual-fund options in their company retirement plan account.

From my experience, any client that you have had a long investment advice relationship with would be more than happy to gain a second opinion from you on their current company retirement plan investments.

With the last few months’ stock market volatility, how hard would it be right now to ask the client if they would be interested in improving the investment performance in their company retirement plan account?

Once you have a copy of their current company retirement plan holdings, you need to also ask for a copy of the entire company retirement plan menu.  This gets a little trickier.  As you would imagine, even your best clients don’t spend a great deal of time navigating their company retirement plan provider web site.

If your client fumbles this request, ask him or her to call their Employee Benefits department to secure an e-mail copy of the entire company retirement plan menu.

My company began providing individual company retirement plan advice by accident over 13 years ago.  During a routine telephone conversation with a client, I somehow managed to ask a question that has completely changed my advisory practice since that fateful day.

The client on the phone with me was a long-time, stock-and-bond client.  I was working at a broker dealer in those days, so the investment advice relationship was strictly stocks, municipal bonds, and zero coupon bonds for his girls to attend college.

My technical research database provider, Dorsey Wright & Associates, had just expanded their daily price chart database to include mutual funds at that time.  For whatever reason, I asked this client for a copy of his new law firm company retirement plan menu at Fidelity.

The new default company retirement plan menu consisted of 16 of mutual funds.

Soon a copy of the complete list of that law firm’s retirement plan menu arrived in the mail. I remember at the time that I really had no idea how I could possible add enough value in order to improve my client’s investment management decisions in his company retirement plan.

I dutifully looked up each of the law firm’s retirement plan default mutual fund ticker symbols.  I then placed them into my Dorsey Wright database portfolio tool.  Immediately I had an analysis and ranking for each company retirement plan mutual fund option.

I remember now that I “muddled through” the presentation to the client.  I especially remember that I had a very hard time explaining the concept of relative strength to my client.

Today I have dozens of individual company retirement plan advice clients at law firms, doctor’s groups, and other Fortune 500 companies in my local market. I only monitor about a dozen company retirement plan menus, but I have several retirement plan advice clients at each of those companies.

Here is a fun fact: Once you get a copy of the default company retirement plan menu of mutual funds from your existing client, every other employee at that company automatically becomes a company retirement plan advice prospect.

When I was much younger in this business, I was always frustrated that my existing clients were never able to refer me to other top executives at the same company. Now, I don’t need that to happen because of my knowledge of the company retirement plan menu.

So, ask your best clients “What’s on your company retirement plan menu” at your upcoming summer events. Then follow the steps I outlined above.

By the time the kids go back to school, you will have found tens of millions of dollars in new assets to manage. And your list of new prospects will be greatly expanded.


Ric Lager is founder of Lager & Company, Inc, co-creator of the “No More Pies” investment series for financial advisors and author of “Forget the Pie: Recipe for a Healthier 401(k).”


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