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Does anyone have any experience with mutual of omaha's bundled 401k plans (or group annuity) with free tpa services? Does anyone know the min plan requirements? internal fees? etc
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Scagnt83~
I am not familiar with MoO's 401k with free TPA services. I primarily use Mass Mutual's 401k product or John Hancock's. I like the Mass plan as it allows you to collect an upfront fee (percentage of assests) and Mass just builds your fee into the plan costs.
The Mass product has the TPA services bundled into the product and you just need to decided on who will serve the record-kepping services.
Just got back late last night from a week long visit to your state....weather was great, the speeding ticket on the way back wasn't though...lol.
I am not familiar with MoO's 401k with free TPA services. I primarily use Mass Mutual's 401k product or John Hancock's. I like the Mass plan as it allows you to collect an upfront fee (percentage of assests) and Mass just builds your fee into the plan costs.
The Mass product has the TPA services bundled into the product and you just need to decided on who will serve the record-kepping services.
Just got back late last night from a week long visit to your state....weather was great, the speeding ticket on the way back wasn't though...lol.
- Thread starter
- #3
- 10,326
A little late, but thanks CFP... lol.
In the past year I have really worked on building my 401k business.
I have found MoO to have a top notch 401K platform.
My top three favorites for plans under 5 million are MoO, Guardian, & LFG.
Not only do they have some of the best investment options, but they are among the lowest in asset charges.
Most all plans allow an "up front" fee as a percentage of assets. Usually this is on all "new money" to the plan. So it not only counts on the transfer of assets from the old plan, but on the monthly contributions on the new plan.
And all plans of course pay a trail based on total assets.
I have never encountered a plan that prices the new money charge out separately from the Total Asset Charge.
The nice thing about 401Ks is that you can usually choose your comp, so if your in competition, you can always take a haircut to help win the business. You can also play with the front end, and back end fees to get the total asset charge thats in the range you need.
I would suggest looking at those three for plans under 5mill. They are ultra competitive and hard to beat.
They are also some of the few plans on the market that utilize Stadion Investment Management Portfolios. Their trading platforms and very strong history of performance (especially in 08') make for a very strong story.
In the past year I have really worked on building my 401k business.
I have found MoO to have a top notch 401K platform.
My top three favorites for plans under 5 million are MoO, Guardian, & LFG.
Not only do they have some of the best investment options, but they are among the lowest in asset charges.
Most all plans allow an "up front" fee as a percentage of assets. Usually this is on all "new money" to the plan. So it not only counts on the transfer of assets from the old plan, but on the monthly contributions on the new plan.
And all plans of course pay a trail based on total assets.
I have never encountered a plan that prices the new money charge out separately from the Total Asset Charge.
The nice thing about 401Ks is that you can usually choose your comp, so if your in competition, you can always take a haircut to help win the business. You can also play with the front end, and back end fees to get the total asset charge thats in the range you need.
I would suggest looking at those three for plans under 5mill. They are ultra competitive and hard to beat.
They are also some of the few plans on the market that utilize Stadion Investment Management Portfolios. Their trading platforms and very strong history of performance (especially in 08') make for a very strong story.
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This year I have partnered with a employee benefits consulting firm whose focus is 401k, executive comp, and group health benefits marketplaces. We are both part of the same agency here in Northeastern Ohio, running our business through the same broker-dealer which is Mass Mutual.
I recently brought them into a 52 person optometry group favorable introduction that I had received this year. A local bank was handling their 401k services and they were very disappointed in the service (surprise surprise) and the lack of having a true consultant. Long story short just last week we won the case after a presentation to the board of directors, going up against three other consulting firms. The plan is a 5 million plan.
It's interesting in hindsight to evaluate how things played out in us winning this case. The other three groups we were up against focused their time and attention in talking about price, performance, and good bit of isolated details regarding their "featured product platform". The Doc's obviously cared about these items, however in our previous conversations with them they seemed to be more led by wanting to partner with a high-end organization who they could hire based upon the firms offerings and abilities, and then have this firm help them choose the 401k platform.
So all in all this is the angle that the firm and I took in working on this case jointly. We did talk about the three platforms that we felt would be the focus of our discussion if they were to hire us, but focused more of our time describing our consultive approach and how we would aid them in "hiring the right 401k platform". At the end of the day they hired us and then we helped them compare the products.....which they choose Mass Mutual.
I agree that the 401k marketplace is a very exciting market to get involved in. It can open the door to so many other opportunities within these groups.
I recently brought them into a 52 person optometry group favorable introduction that I had received this year. A local bank was handling their 401k services and they were very disappointed in the service (surprise surprise) and the lack of having a true consultant. Long story short just last week we won the case after a presentation to the board of directors, going up against three other consulting firms. The plan is a 5 million plan.
It's interesting in hindsight to evaluate how things played out in us winning this case. The other three groups we were up against focused their time and attention in talking about price, performance, and good bit of isolated details regarding their "featured product platform". The Doc's obviously cared about these items, however in our previous conversations with them they seemed to be more led by wanting to partner with a high-end organization who they could hire based upon the firms offerings and abilities, and then have this firm help them choose the 401k platform.
So all in all this is the angle that the firm and I took in working on this case jointly. We did talk about the three platforms that we felt would be the focus of our discussion if they were to hire us, but focused more of our time describing our consultive approach and how we would aid them in "hiring the right 401k platform". At the end of the day they hired us and then we helped them compare the products.....which they choose Mass Mutual.
I agree that the 401k marketplace is a very exciting market to get involved in. It can open the door to so many other opportunities within these groups.
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- #5
- 10,326
I agree that the presentation to the client should be focused on the servicing more than it should the product.
Most clients dont get too caught up in bips structuring and investment options (investment options if anything)
But as an advisor you do need to know which products are the best fit for what size plan.
Also, there are some products out there that have features that will bring a higher level of service to your clients.
Also, the retirement plan world is becoming more and more litigious.
There are plans out there that have different options and features that help reduce the fiduciary liability that the employer faces.
But as you pointed out; the number one reason for a change in 401K platforms is lack of service in one way or another.
Our firm has actually drafted a 401K servicing agreement that we sign along with the client.
It stipulates both parties responsibilities and we usually tailor it to each individual client to some extent; we also let them make requests to add to it.
It also holds the client accountable for being proactive about allowing you to properly service the plan, it usually stipulates a minimum number of meetings each year to review the plan.
But be careful getting too caught up in the servicing and not concentrating enough on the technicals of the plan.
If someone comes in behind you and offers a comparable plan for 50bps less and tells the owner
"this has the same options and the same features, but it puts $58K extra in your account over the next 10 years (assuming a $500K account @ 8%)"
your servicing can be very easily forgotten about.... especially when the new guy says
"if the servicing is so good, then why are the yearly reviews not catching the fact that there are lower priced plans out there??"
"what would your employees say if they new there was an option that could get them $58K more over the next 10 years?"
You have to find the right mix of service focus & technical focus. And of course it changes based on the attitude/experiences/needs of the client.
And you bring up a good point; the client needs to hire you first, then you compare plans and platforms.
Congrats on the 5mill plan. Thats a good size one!
Im always looking for ways to create recurring income in my business. I have found that 401Ks are a great way to do it.
Most clients dont get too caught up in bips structuring and investment options (investment options if anything)
But as an advisor you do need to know which products are the best fit for what size plan.
Also, there are some products out there that have features that will bring a higher level of service to your clients.
Also, the retirement plan world is becoming more and more litigious.
There are plans out there that have different options and features that help reduce the fiduciary liability that the employer faces.
But as you pointed out; the number one reason for a change in 401K platforms is lack of service in one way or another.
Our firm has actually drafted a 401K servicing agreement that we sign along with the client.
It stipulates both parties responsibilities and we usually tailor it to each individual client to some extent; we also let them make requests to add to it.
It also holds the client accountable for being proactive about allowing you to properly service the plan, it usually stipulates a minimum number of meetings each year to review the plan.
But be careful getting too caught up in the servicing and not concentrating enough on the technicals of the plan.
If someone comes in behind you and offers a comparable plan for 50bps less and tells the owner
"this has the same options and the same features, but it puts $58K extra in your account over the next 10 years (assuming a $500K account @ 8%)"
your servicing can be very easily forgotten about.... especially when the new guy says
"if the servicing is so good, then why are the yearly reviews not catching the fact that there are lower priced plans out there??"
"what would your employees say if they new there was an option that could get them $58K more over the next 10 years?"
You have to find the right mix of service focus & technical focus. And of course it changes based on the attitude/experiences/needs of the client.
And you bring up a good point; the client needs to hire you first, then you compare plans and platforms.
Congrats on the 5mill plan. Thats a good size one!
Im always looking for ways to create recurring income in my business. I have found that 401Ks are a great way to do it.
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