The Key to Converting Prospective 401k Clients

What if you could open doors, demonstrate acumen, build trust and strengthen relationships with prospective clients with one simple change?

Sounds too good to be true, but it isn’t. The simple change that could improve those relationships is thoughtful communication.

As a 401k advisor, you may already communicate often with prospective clients, but it’s difficult to walk the line of too much communication and not enough. That’s where thoughtful communication comes in.

By taking into consideration key times when potential cracks in the relationship between 401k plan sponsors and their current provider start to widen, you can hone your communication and make it more effective.

We’ve outlined five points throughout the year that test plan sponsors’ relationships with their provider—what we like to call the five moments of truth.

During these moments, you can offer thoughtful insights and solutions, grabbing a plan sponsor’s attention and, maybe, their business.

Annual census: Late January to early February

The new year is a good time to reconnect with prospective clients to see if they’re looking for new services or considering switching providers. During this time of year, the annual census may also be top of mind for plan sponsors, particularly if there are pain points associated with it.

Conversation starters:

Did your provider make it easy to understand what was needed to complete your annual census?
Did you get the support you needed from your provider to complete the annual census?
Did your provider collect data year-round on all employees to simplify the census process?
What more could your provider have done to make the census process easier?

Compliance testing: Late March

By late March, prospective clients should have received their compliance testing results and taken any necessary corrective actions. The process can be cumbersome and costly. In some cases, compliance testing can shine a light on potential plan design changes that need to be made. This can be a good time to check in with clients and gauge if they’re being well served by their provider.

Conversation starters:

Did your provider communicate about the compliance process and required deadlines?
Was compliance testing completed in a timely manner?
If the plan failed, did your provider use alternate testing approaches or recommend additional contributions to mitigate the effect of the failure on your highly compensated employees?
If the plan failed, did your provider arrange required distributions to your highly compensated employees in a timely fashion or offer alternative solutions, such as paying the penalty?
To improve testing results in the future, did your provider recommend changes to the plan design, enrollment practices or contribution rates for highly compensated employees?

Form 5500 preparation and audit: Early August

Form 5500 preparation, filing and audit support can vary across providers. Prospective clients may need extra support in this area.

Conversation starters:

Was it clear what paperwork was needed to file?
Was the Form 5500 completed in a timely manner? Was it necessary to request an extension to file? Did you get the support you needed?
Was the Form 5500 signature-ready? Did your provider file on your behalf?
If an independent plan audit was required, did the provider make it easy for your auditor to prepare it? Did your auditor see your provider as an ally in this process?

Budget and planning: August through November

Conversation starters:

Did your provider measure and report plan and participant results?
Did you receive information on how many of your employees are on track to replace income at retirement?
Did your provider recommend plan design and communications strategies that can improve employee enrollment and engagement?
Did your provider offer solutions to help ensure the plan is cost-effective?

Delivery of required notices: August through November

For calendar-year plans, many required participant notices must be delivered in the last few months of the year. Distribution of notices can be costly and time-consuming for a plan sponsor. Check in with prospective clients to offer solutions for easing the administrative and fiduciary responsibilities related with notice distribution.

Conversation starters:

Was it easy to understand what you need to do to send notices to participants, including the written message, required recipients, and delivery dates?
Did your provider create the notices? Print them? Mail them?
Did your provider accept fiduciary responsibility for an accurate and timely completion of the notices?
What could your provider have done to make the notification process easier?

With the appropriate timing and questions, you can transform your communication with prospective clients into something more thoughtful and effective, ultimately earning their trust and, hopefully, their business.

Ken Waineo is the senior director of business development and sales operations at The Standard. Ken has more than 15 years of experience working with 401(k), 403(b), and defined benefit and 457(b) plans. In his role, Ken helps cultivate, strengthen and broaden channel relationships, in addition to looking for ways to improve the sales process. Ken graduated from Wheaton College with a bachelor’s degree in psychology and philosophy and earned his master’s degree from Portland State University.

About The Standard

The Standard is the marketing name for StanCorp Financial Group, Inc. and its subsidiaries. StanCorp Equities, Inc., member FINRA, wholesales a group annuity contract issued by Standard Insurance Company and a mutual fund trust platform for retirement plans. Third-party administrative services are provided by Standard Retirement Services, Inc. Investment advisory services are provided by StanCorp Investment Advisers, Inc., a registered investment advisor. StanCorp Equities, Inc.; Standard Insurance Company; Standard Retirement Services, Inc.; and StanCorp Investment Advisers, Inc., are subsidiaries of StanCorp Financial Group, Inc., and all are Oregon corporations.