How To Select a Retirement Plan Consultant

Retirement planning is on the mind of every employee, which means that offering stellar retirement options is something an employer cannot neglect if they wish to stay competitive in the job market. Having a retirement plan consultant takes the guesswork out of the process of building a desirable benefits package. HUB International offers a variety of retirement services, and we are eager to help you learn how to select a retirement plan consultant step-by-step.

Understanding the Role of a Retirement Plan Consultant

Your retirement plan consultant will be a financial expert who will use their own experience, expertise, and insight to help your company offer excellent retirement planning services to employees. Unlike other financial advisors, a retirement plan financial advisor specializes in helping those who are approaching retirement and tailor-crafting the best employee retirement plans on behalf of the business.

The best retirement plan consultants will help you look beyond just the employees who are about to retire. They will also help you offer long-term financial planning services so that your company can build attractive retirement plans for different generations.

Why You Need a Retirement Plan Consultant

Knowing how to select a retirement plan consultant is only half the battle. Hiring teams need to know exactly why the company stands to benefit from the expertise a consultant can provide. This is essential for narrowing down potential candidates to find the expert who is perfect for the role.

Retirement plan consultants can offer the following benefits to business leaders:

• Up-to-the-minute personalized advice
• Expert plan design and guided implementation
• Regulatory support from a retirement plan compliance consultant
• Performance monitoring and plan adjustments

Key Qualifications to Look for in a Consultant

Large companies and small businesses alike face complex retirement plan challenges. That is why you should only settle for a consultant who has the qualifications to tackle those challenges competently. Start by looking for a professional with proven years of experience and meaningful certification, such as a CFP, CFA, or CRPS.

Take the time to be introspective regarding your organization’s specific needs. For example, if you require an IRA consultant in particular, make sure that your chosen consultant has the relevant specialization. Review client testimonials and case studies to ensure that your candidate has a reputation for reliability and results in their field.

Researching Potential Consultants

There are several key considerations to keep in mind when researching potential consultant candidates for your business. This starts with knowing where to find reputable consultant firms in your area:

• Retirement plan consulting firms
• Industry associations (e.g., National Association of Plan Advisors)
• Referrals from other professionals
• Online directories and review sites

When you have a shortlist of potential consultants, you can begin your initial screening process. This can be as simple as scanning CVs for excellent education and certification, outstanding job history, and any potential red flags. This will help you filter the candidate pool further before proceeding.

Evaluating the Consultant’s Experience and Expertise

Preparing the right questions is an important part of learning how to select a retirement plan consultant. When the time comes to interview your prime candidates, consider asking them about:

• Years in the industry
• Types of clients they typically work with
• Specific expertise in retirement planning

Depending on the specific needs of your business, you might ask potential candidates if they have prior experience as a defined benefit plan consultant or other niche financial consulting roles. From there, you can request that they provide case studies or success stories relevant to those roles.

It is equally important to understand a consultant’s investment philosophy before moving to the onboarding process. Certain investment practices might not be suited to addressing your company’s unique retirement plan liability risks. A compatible investment strategy, on the other hand, can greatly benefit your employees’ retirement income planning.

Assessing Compatibility and Communications

The retirement consultant’s duty is to help you help your employees with retirement planning. To that end, it is important to hire someone with a communication style and availability schedule that can meld seamlessly with your company culture.

Communication is at the heart of what a consultant does, making it a role with which a good working relationship is particularly important. Throughout the interview process, make a conscious effort to assess just how transparent your potential consultants are in their processes and reporting.

Understanding Fees and Costs

Overhauling your company’s retirement plan structure comes with notable risks, one of which is the possibility of breaking your budget on consulting fees. The first step toward avoiding this is to negotiate a fee structure that works best for you. Speak to your chosen retirement consultant about common fee structures such as:

• Flat fees
• Hourly rates
• Rates based on percentage of assets under management

Be aware that hiring a consultant might come with some unexpected costs. For example, the future might bring a need to request extra work or travel from your consultant. Be thorough in comparing costs and weighing the potential value against those costs.

Checking Compliance and Regulatory History

One of the main reasons you need to know how to select a retirement plan consultant is that you must guarantee regulatory compliance in every aspect of your retirement benefit offerings. Your chosen consultant must be someone who will absolutely adhere to fiduciary standards so that they can recalibrate your employee retirement plan strategy flawlessly.

Make use of tools like FINRA BrokerCheck and the SEC’s Investment Adviser Public Disclosure to check for any disciplinary actions or complaints against your candidates.

Making the Final Decision

After carefully evaluating your potential candidates and performing thorough background research, it is time to create an even more meticulous shortlist. Conduct your final interviews, keeping in mind these red flags that might still emerge this late in the process:

• Using unreputable tools or software in the consulting process
• Being suspiciously affordable
• Lack of referrals

The most important point to keep in mind is that you should make a well-informed decision. Rely on research and observable facts, rather than any hunches or “good feelings” you might have about a candidate.

Establishing a Working Relationship

Upon hiring a promising retirement plan consultant, you should immediately set clear expectations and goals for your working relationship going forward. Schedule regular review meetings to update one another on strategy progress. Create a process for monitoring and adjusting the plan as needed, which could include preparing a retirement readiness assessment for the benefit of your employees.