Don’t Deride DC Dabblers

Ever heard the term DC Dabbler?

A DC Dabbler is an Advisor that goes out and builds a network of relationships.  They serve their network every day, and every 12-18 months someone in their network needs help with a 401(k) plan.

The nick-name Dabbler simply refers to the fact that the Advisor generates revenue from multiple sources other than 401(k) business, and most are not actively prospecting for 401(k) plans.

Are DC Dabblers a fringe group of Advisors?  We don’t think so.  As of January 2019, 95% of Advisors with one of the largest broker dealers in the country are DC Dabblers.  So this is not a fringe group of Advisors to overlook.  DC Dabblers have relationships with decision makers and get the call when a plan is started or improved.

The DC Dabblers we talk to want to be as effective as 401(k) specialists.  They do this by leveraging trusted expert service provider partners like TPAs and recordkeepers to help them build best-in-class solutions for clients.

And this is where we see an opportunity shift in the 401(k) retirement plan market.  Historically service provider partners focused their time, efforts, and resources on 401(k) specialists (5%).  In passing, DC Dabblers were handed a business card and asked to call when they have an opportunity. Tools created to help the 401(k) specialists might be offered but are not what the DC Dabbler needs to move opportunities forward.  So the entire exchange is a low to no-value exchange for everyone, the DC Dabbler, the sales rep and the client they serve.

Service provider partners willing to create and provide the tools DC Dabblers need to close, create or qualify an opportunity, prepare a winning sales presentation or provide service activities for the 401(k) plan will create a new channel of referrals and sales for their product or services.

We applaud the work DC Dabbler Advisors are doing to positively impact employees and employers.  It’s a team effort that serves everyone.

Job well done!

Andy Hudson, Step Strategic Marketing, andy@stepstrategic.com

Chris Barlow, KnowHow 401(k), cbarlow@knowhow401k.com

TPAs & Financial Advisors are Natural Partners

TPAs & Financial Advisors are Natural Partners

Local Third Party Administration firms (TPAs) and Financial Advisors are natural partners in the employer retirement plan marketplace.  They bring complimentary skills to the partnership and a shared vision of service to their employer and employee clients.  Local TPAs and Financial Advisors:

  • Are passionate professionals who together enhance the probability of their clients achieving their goals.
  • Can have deep roots in their community through their family, friends, and organizations they’re involved with.
  • Have their ear to the ground when it comes to the needs of their community.

 

The ability of the local TPA and Financial Advisor to personally meet with plan sponsors is a win-win-win for all.  The rise of digital communications makes business interactions easier and faster than ever, however many business owners still prefer face-to-face meetings.

 

Local employers, especially those with 100 and fewer employees, are used to working with local professionals, (Attorneys, CPAs, PC Agents, Commercial Lenders) to help them run their business.  Those employers appreciate the benefits of delegating. For newer Financial Advisors, a local TPA’s connections to business owners, CPAs and others can offer them a step up as they begin building their business.

 

Many TPAs rely upon Financial Advisors and other sources for new business referrals.  When prospecting for new business, TPAs and Financial Advisors offer educational workshops for owners and key executives about the importance of employer retirement plans. TPAs also offer workshops specifically for Financial Advisor education, covering a wide variety of topics, from 401(k) plan sales and design, to regulation updates.

TPAs report a far higher close ratio with Financial Advisors when the TPA is present at the sales presentation.  And both have a vested interest in serving the employer and their employees in order to retain the relationship and assist the employer in maintaining a thriving retirement plan.  The service they deliver together produces good results for their community.

 

It all adds up that local TPAs and Financial Advisors are natural partners!

 

By: Laina Davidson, Shannon Edwards, TriStar Pension Consulting

Christopher Barlow, KnowHow 401(k)

Strengthen and Build Your Bench of 401(k) Plan Advisors

Strengthen and Build Your Bench of 401(k) Plan Advisors

I work with TPAs and Advisors every day, assisting them to do more business together. I believe TPAs and Advisors are natural partners.  Here are a few ideas to strengthen relationships and grow sales with 401(k) Advisors.

  • Be a consultant to their business, a member of their board of directors. You witness many Advisors in the marketplace and are a good judge of best practices vaigeneric.com. Offer to review the Advisors acquisition and service activities with your knowledge of other Advisors. Assisting them to refine their acquisition and retention activities will promote their productivity and referral opportunities for your firm. Memorialize your work together in a joint business plan.
  • Advisors need to be confident with your firm’s “story” and you need to be confident in the Advisors. Each should provide to the other marketing materials that they can use to convey the story to plan sponsors and any other that can influence the joint sale.
  • Add to your annual Advisor service model a “State of the Industry” presentation delivered at their office. Keeping them up-to-date will promote their confidence in you and your firm, and perhaps give them a sales idea to share with their prospects and clients. Discuss a case study or two and perhaps jog an opportunity they may have but didn’t look at it until you introduced the idea through the case study.
  • Create a joint service model which outlines a timeline of activities that each is expected to deliver to the plan sponsor and the plan participants. The joint service model can increase sales and retention of plans for both the TPA and the Advisor. The better you and the Advisor can communicate your partnership and shared responsibility to serve the plan, the easier the plan sponsor can decide to hire you.

When I work with Advisors I remind them that they cannot be everything to everyone and that they have to be choosy as to which plans they pursue and partnerships that they enter into. I encourage you to do the same.  Focus on the few Advisors that you want to grow your business with and assist with their development.  Strengthen and build your bench of top Advisors and grow your sales.

February 22nd, 2017