There are an estimated 700,000 defined contribution plans and of those about 175,000 do not currently use a financial advisor.

These companies, ever so slowly, are becoming aware that their plan provider is not their co-fiduciary.  I worked for an 800 lb gorilla 401-k plan provider for many years, mistakenly thinking that they were a co-fiduciary to the plan.  They were (and are) not.  But as Bob Dylan once said “times they are a-changin”.  As the complexity of fiduciary responsibility grows, reliance on a financial advisor becomes an increasingly desirable objective.  You can still go it alone, if you choose, but why on earth would you want to?

Value added Services.

 Here are a few ways a Financial Advisor/Firm can help

1. Lowering plan costs:  Employers using a 401-k advisory firm typically report a better understanding of plan fees and lower overall plan costs.

 2. Better Investment Choices:  A skilled 401-k advisor will closely scrutinize your holdings to determine if there is proper diversification and uncover redundancies in your investment lineup.

 3. Improved Participant Education:  Probably the most significant measure of your plan’s success is your participation rate.  Now more than ever, participants are looking for assistance in reaching their financial goals.  A skilled advisor can provide you with the consistent, robust education (both on-line and in-person) that will improve your participation rate.


Sponsoring a 401-k plan is more than just time-consuming and complicated – it also places legal responsibility on you as sponsor of the plan.  And your plan vendor cannot act as a fiduciary.  Co-Fiduciary responsibility – along with lowering plan costs, improving investment and participant education – are now very compelling reasons to hire a financial advisor.

What are you waiting for?

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