Naturally, one of the first topics mentioned during the first day of the 2024 Broadridge 360 Advisor Summit centered on the Department of Labor’s (DOL) new Retirement Security Rule.
It’s a trending theme we’ll likely see in industry events and conferences to come, especially as retirement plan advisors adapt to the new rule. When polled about their top issues, audiences at this year’s conference voted complying with regulatory changes as one of their major hurdles.
While some have voiced contention surrounding the incoming legislation, advisors who have already incorporated the rule are ahead of the curve, said John Faustino, head of Retirement Products at Broadridge. This is especially true for advisors who have been complying with PTE 2020-02. “Those who embrace the fiduciary rule have a wonderful opportunity when they’re doing IRA [individual retirement account] rollovers and leveraging that. Those who have embraced this are already ahead of the game,” he stated.
Broadridge experts also discussed the convergence of retirement and wealth management, another leading topic in the industry. Cindy Dash, general manager and senior vice president of Broadridge, said the firm has recently connected more with clients on bridging the gap between 401(k)s and nonqualified wealth experiences. As a provider of investor communications and technology solutions, Broadridge has served as a link in this union, Dash added. “For us to be able to be a connection point has really been the request in that convergence we’re seeing,” she said.
Specifically, experts noted an uptick in advisor home offices requesting participant data from their recordkeeping partners, observed Faustino. “There is a lot of compression in the asset management and recordkeeping space,” he said. “We’re excited for several of them that are taking the next step forward and looking at the plan participants’ [data] being owned by the advisor firms.”
Reinventing client experiences is another leading theme for 2024 and beyond, remarked Broadridge experts. According to the company’s 2024 CX & Communications Consumer Insights Report, retirement firms came in last as the best overall CX, with just 11% of investors voting their services as the best experience.
Mike Natoli, chief client officer at Broadridge, noted that as more tech corporations and large organizations prioritize customer experience (CX), clients will expect the same services from the financial firms they work with. He singled out companies like Amazon and the Ritz Carlton, adding that because of their success with CX, a higher number of customers will anticipate similar service from other partners. Eventually, retirement practices will need to follow suit. “When you think about the expectations now as the consumer, the iconic brands that have been out there have just driven this up,” he stated. “Their interactions and the experience they have put out there has drastically raised the expectation across all industries.”
Ultimately, more advisors could start utilizing artificial technology (AI) tools to upgrade their practice, Faustino predicted. “There is going to be a tremendous opportunity to use AI to look at those pools of plan participants,” he added. “Start leveraging these technologies with the goal of making everyone more efficient in their business.”
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.