The Rosenbaum Law Firm P.C. Blog

As you know, Congressman Jamie Raskin (D-MD) was booked for That 401(k) National Virtual Conference. As you also may know, Congressman Raskin was the Associate Dean at American University Washington College of Law when I graduated there in 1997. Law school was tough and it wasn’t fun. In what I thought was a sea of dishonesty about our school and how they portrayed the job market, Raskin was as honest as people can come. Congressman Raskin was that friend that I needed to survive what was a very unpleasant experience, So even when I may disagree with him 80% of the time (probably 99% when I was in law school), he will always have my support because he is a friend for life.

When I look at my career, I tried to make sure never to hurt anyone in one fashion or the other. My motto is simple: “don’t be the a$$hole.” In many of my writings, I focus on those that decided to play that part. When choosing to be nice or to be cruel, always choose to be nice. There is nothing wrong with being demanding or being stern, but cruelness is just a whole different level. Hurting people for no reason or showing people up for the sake of showing them up isn’t the right way to act. I will never understand those in my career that just were cruel for the sake of being cruel. Not going to name names because they are in my Kindle books (still on sale), but with such a small industry, it’s better to be known as being nice than being cruel.

I have been an ERISA attorney for 22 years now and it’s gone by pretty quickly. I have worked for a few ERISA attorneys and have seen quite a few out there giving speeches around here and there.

Probably my greatest talent for helping my own practice and the worst talent in working in a law firm setting has been the ability to connect with my audience. My audience is going to be plan sponsors, third party administrators (TPAs), and financial advisors. My articles, newsletters, and speaking engagements meet the attention span and interest of my audience. When I was working at law firms, that wasn’t going to work because most law firm partners have a tendency to speak above the level of their clients and other attorneys and that’s because they feel the need to justify their fees and their experience by speaking legalese and jargon.

I bill on a flat fee, I have low overhead, people hire me because the fees are reasonable, I don’t need to justify my fees. I’ve seen a lot in this industry (featured in two Kindle books) and some of it was pretty bizarre, so I don’t need to justify my experience. As a retirement plan provider, don’t confuse your clients with jargon. Spit it out, tell your clients what you do for them and why your service is better than the one being offered across the street.

Throwing jargon and technical speak isn’t going to justify your fees, service, or experience, it’s only going to confuse your clients. Tell them what you do in simple terms because no matter what, they aren’t going to do your job. Communication in any business is key and the lack of communication often dooms any relationship. Speaking above the level of your clients isn’t communication because there is going to very little comprehension.

No one is denying that the work you do isn’t important, but if you can’t communicate what you do to your client, often they will find another provider that will.

My latest newsletter for retirement plan providers can be found here.

Being a long time plan provider for a client can be a good thing and it can be a bad thing. While having a long time base of clients is great for business and indicative of client satisfaction, it can be a bad thing too.

Being a long-term provider for a plan sponsor client can be a bad thing. It’s like the folks on my local board of education. The members of the board of education have run unopposed for years and there has never been accountability. When you run unopposed, you end up thinking that you are so great that no one wants to run against you. You also end up with a sense of entitlement because you have been there for so long.

The same can be said for long-term plan providers. There is that sense of complacency and the sense that this position as a plan provider is their divine right. Thanks to fee disclosures, the retirement plan market is more competitive and long-term plan providers may have more competition in keeping that business. The problem is that if you have been that plan provider before fee disclosure, you may still think you are in the good old days when their plan sponsor clients rarely reviewed plan providers.

So being a long-term provider is great for the pocketbook, but a bad thing if the provider loses sight of the ball.

People don’t like to be accountable for the most part. It’s just human nature to blame someone else. Heck, I used to do it at work and I still do it at home (sometimes).

When I was working at that law firm and I wasn’t able to draw enough business to my practice, I can fault the law firm partners who didn’t refer me work or the marketing office couldn’t help so much because they were doing work for other and the process took 6 months to get an article published. Ultimately, it was my fault that I didn’t get it done. So I dusted myself up, went on my own, and the rest is history (I mean it’s in two eBooks). I changed what didn’t work and what I wasn’t allowed to do (social media) and I was able to support myself on my own.

Too often plan providers get in the business of not admitting fault when they make mistakes and it’s frustrating for plan sponsor because sometimes all they want is a simple apology.

An apology is not an admission of guilt, it’s just an expression and sometimes just saying you’re sorry is what minimizes small disagreements into becoming World Wars. I know firsthand, I grew up in a family where you think an apology was draped in the blood of the one who offered it. Being accountable and admitting when you’re wrong is just good business skills. It’s a great way to retain clients because it’s the unhappy clients who leave.

A recent study by Access Point HSA, a Rhode Island consulting group, conducted a survey over the summer that shows that advisors are getting more involved with Health Savings Accounts.

About half (49%) of the advisors that were surveyed, stated that they currently offer HSA services to their clients. 44% responded that they didn’t, are interested in offering HSA services.

It’s a no brainer for advisors as it allows them to broaden their relationship with their clients, as well as growing assets under management. If you’re an advisor not offering HSAs, you are leaving money on the table and the chances are that another advisor could pull HSAs out of their bag of tricks, making you look bad and you can’t afford to look bad.

With the restatement process underway, it certainly makes sense to review your plan document and see which provisions could use a little tinkering. Perhaps you want to change the eligibility or add a Roth 401(k) feature. Whatever it is, it’s best to get these changes in the hand of your third party administrator (TPA) and get it incorporated in your next restatement. It should save some shekels and it would be easier than having a separate amendment drafted to achieve that feat at an added fee.

For those with defined contribution pre-approved plans, it’s time to restate your plan document. You have until July 31, 2022, to fully restate your plan document for the Cycle 3 changes.

While not as substantive as previous restatements (it doesn’t even use the acronym of a retirement plan law change like other previous restatements), it still must be done because the Internal Revenue Service said so.

Contact me if you need a restatement at a flat fee.

My latest article for JDSupra.com can be found here.

My latest newsletter can be found here.