Recordkeeping and administration of retirement plans is multifaceted, and the proposals for these services reflect that complexity. The proposals also serve as marketing documents for the vendors and must be evaluated with an eye for differentiation and services. A scoring matrix can assist in evaluating vendors during a Request for Proposal (RFP) process.
The substance of most proposals fits within one of the following eight categories:
Over the course of a series of blogs, we will explain why each of the eight categories are important criteria to review, as well as provide areas of consideration for each category as you evaluate service providers.
In Part 1, we discuss the criteria surrounding the organization, their client service model, and their participant education and communication.
Recordkeeping services are often one line of business within a larger organization including insurance companies, investment managers, banks, and other large financial institutions. Recordkeeping is a complex and multifaceted service which continues to evolve.
Plan sponsors should look for a provider in good standing with regulators, is committed to maintaining their recordkeeping services, and has enough breadth and depth of resources to continue to invest in technology, staffing, and advanced services.
- The size and depth of resources available to maintain and invest in the recordkeeping business line
- The level of experience with your plan type, size, and industry
- The vendor’s industry tenure and commitment to the recordkeeping business
- The stability of the organization, tenure of leaders and staff
The relationship between a plan sponsor and recordkeeper can vary wildly by vendor, plan size, and demand. Some can be high touch, with dedicated strategic relationship managers, administrative contacts, education and communication leads, and more. Other models rely on ticketing systems and administrative call centers.
- The makeup of the team, including dedicated roles and internal support available
- The tenure, case load, and credentials of named individuals
- Available communication methods and issue resolution
- Service guarantees and any fees at risk
Education and communication are important activities which engage with participants in ways that improve retirement outcomes. Whether it’s the recordkeeper, plan sponsor, or participant that initiates the conversation, there are a range of methods and tools to consider. Both proactive and reactive resources can help participants in both the short and long-term.
- What are the key elements of an education program?
- The number of education days provided
- Tools available to help participants analyze their saving metrics
- The type of advice offerings available to participants
- Call center hours, staffing, and availability
- How will the effectiveness of education and communication activities be measured?
In the coming weeks, we will be sharing the remaining five categories in Part 2 and Part 3 of this informational series.
Multnomah Group is a registered investment adviser, registered with the Securities and Exchange Commission. Any information contained herein or on Multnomah Group’s website is provided for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Multnomah Group does not provide legal or tax advice.