Complicated DOL Regs Provide Opportunity to Interact with Plan Sponsors   

Did you know that about three out of four plans audited by the Department of Labor (DOL) have at least one violation? It's no wonder with the complicated and ever changing 401(k) rules and regulations, that plan sponsors and fiduciaries find their plans out of compliance. This presents an opportunity for plan advisors to help keep plans sponsors up to date on the DOL's ever changing regulations that can leave some plan sponsors and fiduciaries out of compliance without even knowing it. The Employee Benefits Security Administration (EBSA), a division of the DOL, handles plan audits. One of the best ways to educate your clients on how to avoid being an easy target is by holding a seminar or webinar with your local DOL representative and an ERISA attorney where your current and prospective clients are educated and updated on the rules. A seminar is an ideal time for attendees to ask questions pertaining to their unique situations.

The first step in preparing for a DOL seminar or webinar is to contact your local DOL representatives and invite them to give a presentation to your clients and prospects. You can also invite an ERISA attorney in your area to answer questions and allow their clients to attend as well. Topics for discussion can include EBSA investigations and enforcement actions, DOL's expectations for plan sponsors, fiduciary responsibilities, litigation updates and the consequences of a DOL audit.

These are some general areas in which your clients may have more specific needs and will be able to have their questions answered, without the threat of plan or fiduciary violation. This seminar also provides the opportunity to invite prospective clients, so they see your interest in keeping clients up to date on compliance issues.

Educating your clients about DOL regulation changes can seem like a daunting task. By going directly to the source, you give your clients an exceptional opportunity to be educated and to ask the experts. An additional benefit to a DOL seminar is the prospecting value. Prospective clients will be impressed with your ability to host a seminar with DOL representatives.

Patricia McNeilly, a branch owner of American Portfolios in New Jersey, attended The 401k Coach Year 1 and Year 2 programs where she obtained the DOL Seminar Kit. The DOL Kit helps advisors coordinate an event with DOL representatives for clients and prospects with a step-by-step guide and invitation. "It's been great," says Patricia about the DOL Seminar Kit. "It gives me a great image and it's working, because it puts me in front of the right people."

For a step-by-step guide on how to conduct a DOL Seminar and help your clients and prospects maintain their compliance as plan sponsors and fiduciaries, purchase The 401k Coach DOL Seminar Kit.

Ask us about a turn-key DOL video marketing campaign that can provide a unique experience and stream-line the invitation process for your DOL seminar or webinar.

401k Coach Products

As with all our products, 401k Coach members receive a special rate. Be sure to look at all our helpful products, including:

The Bear Market Manager™ provides a series of tools and conversations designed to help participants take back their futures and re-engage their involvement in retirement planning.

ERISA Plan Fiduciary Indemnification System™ takes on the issues surrounding fiduciary exposures and liabilities. Use this formalized process to offer complete protection for ERISA plan fiduciaries. 

The Problem Solver™ will support you and your team to overcome problems that may inhibit the success you seek to achieve.

The 5500 & Beyond™ is both a training and marketing tool created to help you understand the Form 5500 and its components while teaching you to uncover plan disruptors for successful prospecting.

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Dependable Portfolio Construction with Craig L. Israelsen, Ph.D

For those of you who don't know Craig Israelsen, he is an associate professor at Brigham Young University, principle of Target Date Analytics, designer of the 7Twelve Balanced Strategy and author of "7Twelve: A Diversified Investment Portfolio with a Plan" (see Charlie's Bookshelf in this newsletter edition).

What Craig proposes is this: the "core" of a portfolio can be known in advance. The core does not need to be designed for each individual client because virtually every portfolio will use the same diversified core element. A financial advisor should not be spending time designing a portfolio core for every client. Rather, the advisor should be determining how much of the "core" to utilize for each client and what type of "explore" assets to add around the "core" to best meet the client's unique needs and circumstances. Essentially, the core of a portfolio becomes a commoditized product used by financial advisors. The financial advisor adds considerable value by knowing what individualized "explore" assets should be added to the "core" to best serve the needs of each specific client.

Building a broadly diversified balanced portfolio enhances the inherent virtues of the classic 60/40 balanced model. Achieving better "balanced" performance is not the result of skill, but simply the natural byproduct of meaningful diversification and systematic rebalancing. Using the 7Twelve Balanced Strategy in an age-based portfolio model offers protection when it is needed most - as an investor approaches retirement.

So what is 7Twelve? The "7" represents the suggested number of broad asset classes to be included. The "Twelve" represents the 12 seperate mutual funds or exchange traded products to fully represent the 7 asset classes. The 7Twelve portfolio has approximately a 65/35 allocation: 65% of the portfolio is invested in equity and diversifying assets and about 35% invested in bonds and cash. The 7Twelve balanced portfolio is a Qualified Default Investment Alternative (QDIA) under the provisions of the Pension Protection Act of 2006.

If you are interested in learning more, please email Craig Israelsen or purchase the 2011 7Twelve Research Report. Renewal Research Reports and a presentation outlining the principles of diversification are also available.