Name: jeff kuzmich - Migrate_FA_5_Tips_Growing_Retirement_Base_06252025_4943973
Uploaded: 2026-02-26T05:53:56.450Z
Duration: 32 min 17 s
Description: jeff kuzmich - Migrate_FA_5_Tips_Growing_Retirement_Base_06252025_4943973

Transcript for "jeff kuzmich - Migrate_FA_5_Tips_Growing_Retirement_Base_06252025_4943973": And welcome to our event, five tips for growing your retirement base today. I'm Daniela, and I'll be moderating. To ensure that we all have a pleasant experience, I'd like to highlight a few items regarding the webinar functionality. First, please note that the primary audio connection for today's session is streaming via your computer, and there is no dial in option. Be sure to check your speaker volume to ensure your computer audio is turned on and set to an audible level. To refresh or reload your webinar browser session, for a PC, press the F5 key, or on a Mac, press Command R. To download and print a copy of today's deck for future reference and to access additional resources, refer to the files and resources window at the top right of your console, available at any time during today's event. If you have questions during the webinar, you can send them via the Ask Us a Question window. To submit a question, simply write in your question and click Submit. We'll have specialists in the back end responding directly to your questions. While we may not get to all the questions due to time constraints, we want you to know that all questions are received and reviewed and can help us create future resources like this to support your needs. Please note that this presentation does not constitute legal advice and is for informational purposes only. And now let's get to know our speaker today, Michael Nash. Mike's long and successful career in the retirement industry has been in both management and sales. Prior to joining Paychex in 2021, he held leadership roles at Lincoln, John Hancock, and Alliance. With his decades of experience and in-depth knowledge, he helps plan sponsors create a more stable retirement for themselves and their employees. Five tips that we'll learn today will perform a book review, conduct client discovery, identify new prospects, build a new business pipeline, and leveraging partnerships. Before I turn things over to Mike, we do have a poll question. It should come up on your screen here. Do you currently have a process in place for prospecting new clients? A, yes, but looking to improve on it. B, yes, but it is loosely followed. Or c, no, not a formalized process. You can go ahead and select a, b, or c. That'll give us an idea of where everyone's baseline is, so Mike can adjust his presentation accordingly. Okay, looks like we still have a few coming in, so I'll just give it another moment or so. All right, and with that, Mike, I will turn it over to you. Thank you, Daniela. Hello, everybody. I want to thank you all for taking the time out of your busy day. I hope all of you having a great start to your summer. Some are probably a little warmer than others, but that's summertime. What I wanted to do today is kind of just kind of go through and kind of give you some ideas. Hopefully you'll take something out of this, maybe multiple things, but what I want to do is kind of just talk about the opportunity in the four zero one ks world. You probably all read and heard about this, but today there's about seven hundred and twenty thousand four zero one ks plans in existence. That changes from year to year, obviously, but what's really interesting is that the experts, the consultants, the people who do the research, are predicting that by the end of this decade, so roughly in about five years, there'll be close to or over a million plans. Now, where are these plans going to come from? Well, they're going to come from small start up plans. Reason being, mid to large sized companies already have a four zero one. So, we're going to see a significant growth in the small market opportunity. And there's a number of things driving that, we're going to talk about that, but just looking at it, just since 2018, we've had almost a 6% increase in adoption of retirement plans, so that's only going to get higher. A third of all businesses have a plan today. And really what I think is interesting, just from 2020 to 2023, the employee participation is up significantly, almost 10%. So we're excited about that obviously because we're in the retirement business and the thirty five plus years I've been in this, this is I think a great time for those of you that are in this business to refocus on it. For those that aren't, this is going to be a great opportunity because there's going to be literally hundreds of thousands of plans over the next couple of years. So let's talk about why it's going on. First and foremost, it's the labor market. You've all seen and read reports that how difficult it is for plan sponsors or small businesses or even large businesses to retain and attract new employees. So we're definitely seeing the labor market is driving those companies that haven't had a retirement plan to create one, mainly just to be competitive, to attract those new employees. The SECURE Act two point zero, there's been a couple of these obviously, but the SECURE Act has made it easier for plan sponsors to create a plan. As I said, I've been doing this for quite a few decades. One of the things you always heard from smaller plan sponsors or startup companies was that it was too expensive, too much involved for them to do that. Well, the SECURE Act has brought things in with tax credits and making things a little easier, so that's really not an excuse for plan sponsors anymore. So, you take the labor market pressure, you take the tax credits that the government is now offering on a federal level, and you complement that with the state mandates. Right now, a little more than half of all the states have a current mandate. Now what these mandates are really is that each state is coming up with their own retirement solution. Now I want to make sure these are not uniform. The only thing that's really uniform about them is that the states are offering an IRA. So, what they're saying is that businesses have to create a retirement plan under a certain time structure. So, roughly about half of the states have done this, half of them aren't. What's also unique is that some have done this a few years ago. California just seems to be the leader in a lot of things and California started with, if you had more than 50 employees, then it went down to I think 25 to 15 to five. And California right now is if you have more than one employee, so if you have a business and you don't have a retirement plan set up by the end of this year, this calendar year, you're going to be receiving penalties and the penalties can be excessive. Now, the other thing that's interesting is not every state has penalties. California has had their plan around for about five years and I think the penalty now is $500 per employee. To give you an example, two years ago when I think it was 15 employees or maybe 10 employees or under, California was sending out notices to businesses that hadn't set up a plan and they ran out of envelopes with the notices. They had over 200,000 companies in the state of California that hadn't done it yet. So, definitely one of the places that we're going to see a lot of interest. New York is launching their program later this year, just to kind of give you a state that everyone Illinois has already issued penalties. But then there are groups like the state of Maryland who hasn't issued penalties, but is highly recommending people do that. So, if you're not sure about what the state requirements are in your particular state or states where you have clients. You can go on to the paychecks website and we have a complete interactive map there where you can check and find out the details of the particular states you're interested in. Once you do that, and if you do have clients or you are in a state with a mandate, I think you'll find that's going to be a very good opportunity for you to get additional retirement clients. So, what are the five tips? And this is what we've done a lot of work with our marketing team and kind of come up with what we think are five tips to kind of get you through and provide you the opportunity to have more success in the retirement business. The first is perform a book review. And you've probably heard this, the terminology used in different features or different opportunities, but ours is review your current client list. So, really look out of your small business clients, how many of them are C level clients, how many don't offer a retirement plan, if they have a plan, is it with a different advisor? If it is, that's a potential threat to your business or business you have with them. Has the plan undergone any benchmarking? Typically, benchmarking is a review of the cost and performance of a retirement plan. The experts suggest you do this every two to three years. Some people do it more often, some people do it less often, but think that the two to three years is probably a good way to do that. We can help with that process. The other thing is prioritize your clients that are most likely to adopt or convert a plan. So you just create a list. You should probably do that anyway. And lastly, establish a target list of current clients of where you think you'd want to start. As I said, if you're in a mandate state, that list will kind of create itself for you. The next thing is you're looking at clients without plans. These are clients where you have a recurrent relationship with and don't have a plan. So you're looking at dispelling common myths about starting a plan. Like I said before or earlier, plans are too expensive. They're not anymore. That's really not a viable excuse anymore. You're just looking at the retirement readiness. Retirement is becoming more of a other than healthcare, it's probably the most important opportunity or benefit a company can offer. The tax benefits, as I said, a small business today can receive tax credits up to $5,500 a year. That's typically more than enough money to pay for the costs associated with the plan. So they get any money they spend back as a tax credit from the federal government. So, from a benefit standpoint, we already covered this, to retain and attract new talent. And the other thing is the government's made the four zero one plans a little easier to administer. You have four zero one peps that are now available, which takes a lot of the fiduciary responsibility and work associated with the plan. Then you have things like safe harbor, which makes the contribution process a lot easier and easier to maintain. So what we did here was we kind of looked at clients with plans and uncover potential reasons for a conversion. So you're looking at action items and then things you can educate them on. So initially you're looking at things like high and hidden fees. Believe it not, there's still a lot of plans out there that have really high fees and don't know it for one reason or another. You're looking at poor service levels. I mean, there's a number of factors that go into a retirement plan. There's fees, there's fiduciary responsibility, work associated with the plan, payroll, things like that. But I can tell you the second bullet point right here is probably the main reason I see people leave a retirement plan. I've probably sold a few thousand four zero one plans in my time, and service is usually the number one thing. It's not always about you don't have the right investment option or the right number of investment options. It's typically about service level. So, next to that, complex manual administration, that makes a plan sponsor feel not too thrilled. Fiduciary risk becoming more and more of an issue over the last few years, staying compliant, and low participation rates. And so from things that I think that we can help you educate them on is planned benchmarking. They'll need to evaluate fee structures and fee transparency. We've had a lot of people that aren't really sure what they're paying. So, out through that process is definitely going to be important to you and your clients. Dynamic, the fiduciary dynamic landscape. Fiduciary issues have become more and more of an issue. The DOL does audits every year of retirement plans. And this may come as a surprise, but 70% of the time they find an issue. And they're evaluating and auditing large plans and small plans. But the point I'm making is their success rate for finding an issue is close to seventy percent. So no matter what you think you're doing things right, there's always a need for an opportunity for improvement. The other thing is, if you're not a regular four zero one or retirement person, leveraging your partner resources. We're going to cover that in a little more detail, but there are resources and people out there that you can talk to that help guide you through this process from the beginning to all the way at the end. If you want some guidance as how to prospect and how to identify leads, those resources are there. Now prospecting for new clients and so, let's take a look at the first bullet point just points about if you have clients or you're in a state with a mandate, there's definitely an opportunity there. Leveraging rollovers. I've always told advisors that the easiest way to find a retirement plan opportunity is a rollover. And there's different ways of getting to a company or a small business today. It's going in the front door and making a cold call or talking to someone that you know, one of your clients may work there. The other way is kind of getting in the side door or the back door. And that's where I think rollovers are great. I mean, loves a rollover for the most part. The small rollovers aren't always as compelling, but if you're getting a rollover from someone you didn't really know or you referred in, this is an opportunity for you to ask this client as you're going through and getting to know them, who at the company they just left is in charge of the retirement plan? Or who handles the benefits? This is an opportunity for you to what I've kind of coined this phrase a number of decades ago, a corporate rollover program. This is where you go to that HR manager or benefits person and say, tell them that you're helping this new, the ex employee with a rollover. And then you do this for a living. You help employees transition out of companies. And you ask that person at the HR, the benefits person for the opportunity to have a discussion or maybe even an in person meeting, so you can then show them how you can help employees transition out of the company. And historically, when I've done this and recommend this to other advisors, the HR manager or the benefits team, they love this idea because they can't really give a lot of guidance because they're not licensed or equipped to do that, but they love the opportunity to have someone come in and do that. This gives you the opportunity to talk to people that are leaving the company, gives you the opportunity to talk to people if they're doing layoffs or something like that. But my point is it gives you the opportunity to develop a relationship with that company while being compensated for helping employees on the way out. So there's nothing to it. There's no documents. It's just a program that you can kind of create and we can guide you through that process. So, next bullet point, develop a referral pipeline. As I said, just keeping a listing of who the contacts are at these companies. It's a great way to establish relationships. The other thing is cultivate relationships with centers of influence and a couple of them here are benefits brokers, CPAs, lawyers, chamber of commerce, networking groups. I knew a few advisors who worked with some benefit brokers who weren't licensed and didn't do what the advisor did. So, they just got together and compared clients and said, well, I can introduce you to some of my clients and vice versa. So, it's a great way to have some of these reciprocal arrangements. Content marketing, social media. We're seeing a lot of that over the last few years. Obviously be well aware of any rules that your broker dealer or the firm you work with have in regard to social media, but definitely people are having success in that regard. And then I talked about this earlier, but partner with a record keeper or a wholesale team that has ideas that can help you through this process. Not every record keeper today is really interested in small market or startup type plans. Make sure you find someone who is. Now questions as an action item. There are questions you can ask and really all you're for here is just questions that you can look at and look at the plan's effectiveness. So, off the top, it's like, have you had administrative work? I mean, some companies still do a lot of administrative work associated with the plan. That could be a combination of payroll, changing payroll data, things like that. A lot of this can be taken off of their hands these days with a more robust fiduciary or a more robust payroll integration. So, the other thing is, do you have a three twenty one or a three thirty eight fiduciary? These are investment fiduciaries that have grown in popularity over the last decade. Three twenty one is more of a solution where the plan sponsor still has some involvement in the three twenty one fiduciary. And a three thirty eight fiduciary is typically where the plan sponsor who is obviously in charge of the plan is more insulated when it comes to choosing and maintaining the investment menu. So we have advisors that have taken this responsibility. And there are also groups like Mesero and Morningstar and a few others that will also take this fiduciary responsibility over for her fate. And if you're a plan sponsor, great question I used to tell advisors to ask was, do your employees value the plan? Are you getting complaints? Do they see that as a benefit? Are they taking advantage of it? Do you have high participation? Is it low participation? That'll kind of give you a better idea of how they're valuing the plan. And the second to last year is when was the last time you did a performance and cost analysis? Are the funds good choices? Are they still good choices? Is the fee structure out of line? Has the plan grown in value over the last few years and should it be looking at a lower cost structure? Just things that we can help you through that process. And then the last part is, are you aware of state required mandates? I've had a lot of conversations with businesses, even a number of banks over the last few months, and not everyone is familiar with these mandates. The main way you'd be involved is if a trusted resource like your advisor told them. A lot of them are notified via mail by their states. And I think a lot of people kind of look at it when they get mail from the state that it's typically not something they want to look at or they put it to the side with the thought of getting to it later. But as I said, a number of states are going to be setting up penalties or already have them and it could be a costly mistake for companies that are in a state mandate. It could be a costly mistake if they don't get the plan created. And that's where an average to businesses in these states. And as I said, it was probably close to half and I would not be surprised if by the end of this year we're over 30 states that have a plan. So that number is going be growing. So all of you will probably have clients and be in states that have amending at some point I should say. Okay, questions to ask prospects without plans and once again, we're just kind of differentiating those with plans and without. What kind of business do they have and how many employees do they have? Have they looked at doing this in the past? If they have, why didn't they do it? Once again, the state mandate question we just were recovering. What are the demographics and the age of your employees? Do you have a bunch of older employees, younger employees? Do they have a tax reduction strategy? Are they using IRAs to save for retirement? Does it look like from you? Are your employees asking about this? I would think over the last few years, more and more employees are doing that. Do you need it? I mean, you lost employees or not taking on a new employee because you didn't offer this benefit? And this question I always thought was pretty interesting. You're asking the plan sponsor or the company ownership, do you have a strategy for retirement? A lot of them will tell you that the business is their strategy for retirement. And that's going to fund their retirement. But I think we also all know that not all small businesses always survive year to year. So, the retirement plan might be a great alternative to that small business and God forbid something were to happen. A lot of changes obviously happening today with small businesses, the pressure, the fee structures, AI, a number of things can affect whether the company is going to be around in a number of years. So, then we talk about, once you've identified prospects both in your current client base and out of the base, now you've got to kind of build a prospect pipeline. And there's a number of ways that you can do this. Some of you might work with firms that have their own CRM system. Otherwise, others of you can pick up some of these systems or relatively low cost or even no cost in some cases. Worst case, you can always just use an Excel spreadsheet. That's what I've done numerous times in my past. But the other thing you need to do is kind of just develop a sales process. And this may not be something you can come up with right away, but as I said before, there are trusted resources out there that can help you through this process. But developing the process is really going to be important. And then creating a statement of services to show your value. I can tell you that a lot of advisors that I've worked with over the decades haven't really done this. They've all wanted to do this, but they haven't really done this. And I can tell you this can be really an effective tool to get out to a plan sponsor, especially to someone who's a startup who maybe hasn't had a four zero one ks plan before and they're going to rely on you as the advisor a little more so because they're just inexperienced when it comes to the four zero one ks. We talked about this a minute ago is consult with your financial partners. This is where you can talk to different organizations, different wholesalers about how to build this practice and what you can do and more importantly shouldn't do to be successful. And the last bullet point here and this is something that I think we've probably all been guilty of at some point in our career is following up. The follow-up is the main thing. There are different ways you can follow-up. One thing I used to do is, I was talking to an advisor or a plant sponsor, I would constantly be looking for interesting and unique articles on a four zero one ks or something that affects their business or their industry and just send them, do a drip campaign. Send them, Hey, I thought you might find this link interesting or you might find this article interesting or Hey, there's significant growth with small businesses creating retirement plans. I thought you might enjoy the read. So, it's typically not a lot of time. It's just dedicating the time to follow-up and do this. And I can tell you that plan sponsors will want to work with someone who thinks that they truly care about them, their employees and their business. Okay. So we talked about this a few times, but leverage your partners. I mean, with partners who can provide advisor dashboards, tools, things like that. There's a number of ways you can get information on businesses in your general area. There's websites like Judy Diamond, Markspur. The other thing you could also do is just go to the Department of Labor website. You can go on there and search 5500s. 5500s are the tax returns that retirement plans are required to file each year. And you can do a search via towns, zip codes, certain size plans. There's a number of ways and a number of your vendors, paychecks included, can help you through that process. You can give one of our wholesalers a certain state, certain county, zip codes. We can provide the listing to you and then you can go through and just identify the prospects in that regard. So it's one way to I think really, turbocharger gets started in this industry. The other thing is you can look for wholesale partners to get guidance on book reviews and what questions to ask and how to position yourself, how to position your firm. We talked about this a minute, just access to the databases and prospecting. Inquire about partner reciprocal referrals. This is what I talked about before, looking at other centers of influence out there that don't necessarily do what you do, but could become a good referral source and back to them in that regard. And lastly here, look to collaborate with record keepers with mutual interest. You probably want to combine with a four zero one ks record keeper that isn't a competitor of yours. So you don't have to worry about that, but also is dedicated to the smaller end of the business. You don't want to have to be able to compete with them at some point. Okay, so from a paycheck standpoint, this is just a couple of questions or a couple of points on us and we've made a lot of changes over the last And the first thing is really with integration. Integration, I mentioned that a few times earlier. Historically, Paychex can only do a client's four zero one ks if we had their payroll. That changed a few months ago. So now Paychex and what's interesting and now we can work with 90 different companies or 90 different payroll vendors today. So you don't have to have a Paychex payroll to get access to Paychex four zero one ks platform. Over the last three years, we've done over twenty five thousand four zero one plans per year. Of that 25,000, roughly about a little over 3,000 per year were conversion plans, meeting existing plans. The other 22,000 plus were startup plans. So we have the infrastructure out there to support these plans. And the other thing that's unique is these startup plans are typically done, up and completed within two to three weeks. So we can do it very quickly just because we've been doing it for so long. And the last part is, there's a number of things here, but I'll focus on is the investment neutrality. We're a total open architecture. We don't have any funds of our own. And we typically use institutional type funds, so there's no revenue built in. We're looking for the lowest cost options for our plan sponsors and participants. So, we're just about on the cusp, so what I'll do now, Danielle, if there's any questions. Sure. Thanks, Mike. Before we get to our questions, I do want to just put up our last poll question, and if you would like to speak with a member of our regional wholesale team about growing your business, you can just go ahead and click yes or no there, and we will get you in contact with your correct wholesale representative. We're cutting it close on time, so we do have a couple questions. I know there were a lot of questions about state mandates specifically. So I did just want to call out that on your console in the resources screen on the right hand side, there is a link to the state mandated program website that we have at Paychex that will have all the details for your specific state. It's a great tool for you to see where they are in the process, if they are enacted or in the implementation mode, so you can get all your information there. I use them all the time myself when I'm talking to clients throughout the country. Same thing here. One quick question before we close off. What are the most important questions to ask a prospective client on the first meeting? Well, you know, before I talk to a client or talk to an advisor or someone I haven't met before, I do a lot of research. So as a client, I'm going to learn a little bit about their business, a little bit about them if I can. LinkedIn is a great source. But if I'm in the retirement business, I mean, there's a number of questions we can kind of guide you through. But if not, you definitely want to talk to one of our wholesalers just to kind of get a feeling for the industry or as I said, I'll probably typically look at the 5,500 if there is a current plan. If not, there's a number of things you could do. But I think the first thing you would probably want to ask a plan sponsor is what is your plan for retirement? Why don't you have a retirement plan today? What's the compelling reason behind that? And obviously if it's a mandate state, is very popular today, you know, it's just at that point, are you aware of what's going on in the state and that you need to have this plan at some point in the near future? So, I think that's a great way to start. So as I said, I think you just talked about the link. I would check out the state mandate website first and then in my next would be talking to one of our wholesaling partners. Great. And we are at time, so I do want to be conscious of that. We did have a number questions come through. We will answer those and get in contact with you on the back end. And as we said earlier, thank you for joining us. A reminder that the deck for today's presentation is available in the files and resources window. To view advantages of partnering with paychecks to help you grow, you can click the Access FA Advantages button on your console. Thank you very much. There will be a survey that comes up in a few moments. We ask that you complete that. It is very helpful as we continue our future planning for our FA webinar series here at Paychex. Thank you very much, and have a great day.