Open Architecture
Unlike some plans which are limited to a specific fund family or
predetermined group of funds, the PremierSource model offers the
universe of investment options. There are no fund requirements except
those set by the client. This allows our clients to be nimble and
replace funds and fund managers who fall outside the investment policy
guidelines without upsetting the entire plan. It also allows our
clients to diversify risks associated with a single fund company. Open
architecture of employee retirement programs has been a key area of
emphasis in DOL reviews of late.
Objective, Expert Fund Performance Evaluation
Because our group retirement model is based on investment advisory
services and not broker commissions, our fees are the same regardless
of the funds or platforms we recommend. This places our interests
parallel with the client’s and allows us to select funds and platforms
based on long-term performance, stripped of any broker commissions or
loads. While we serve plan sponsors representing retirement plans of
all sizes and designs, within our “power alley” (plans exceeding $3
million in assets), we are able to consistently out-price our
competitors using this model.
Multiple Layers of Investment Advisors
Because we are a federally registered investment advisor, our model is
designed to appeal to all levels of stakeholders in the plan. Where the
majority of the market providers and plan sponsors are restricted from
offering investment advice, our registered advisors have been given the
authority to do just that. At the plan sponsor and fiduciary level, we
have a team of advisors who evaluate and make recommendations to the
plan sponsor about the investment choices to offer in the plan. At the
individual participant level, we have investment advisors on the ground
that are registered advisors and can offer one-on-one participant
investment advice and guidance specific to that participant’s needs.
There is no additional charge to the employer or participants for these
advisor resources. This is a very unique offering, and we have seen
plan participation greatly increase with this particular feature.
Participant Education
As a provider of employee benefit services, we believe it is our role
not only to assist you with your employee benefit needs, but also to
actively promote employee participation through informed
decision-making. We have developed interactive employee education
programs that reinforce the long-term value of employee participation
in your group’s customized plan.
Plan Design Evaluations
Sometimes plans have not explored alternative plan designs for cost
savings. For example, in 2003, the IRS took a new position with regard
to discrimination in qualified plans. Certain employers can now take
advantage of a “cross-tested” plan design that allows employers and
highly compensated executives to tax-defer larger percentages than in
the past without having to raise contributions across the board. This
can result in significant tax savings for some employers. Further, many
times we can evaluate a bundled plan and reduce costs or increase
service value by unbundling the administration or recordkeeping and/or
vice versa, depending upon the plan specifics. PremierSource looks at
each case as unique to determine what plan design options are available
to maximize savings and quality for the client.
Vendor Leverage and Negotiations
PremierSource proactively and aggressively negotiates fees on behalf of
its clients — not only on the front-end, but also at the appropriate
“trigger points” along the way. Because of our significant volume and
our unique business model that incorporates relationships both
statewide and regionally, we have pre-negotiated preferred pricing with
multiple vendors in the retirement industry (e.g., Schwab, Principal,
T. Rowe Price, Fidelity, Mass Mutual Financial, etc.). Intrigued by our
retirement model, the top executives at several key national vendors
have even invited us to their headquarters to negotiate preferred
arrangements. With several key vendors, we lead the nation as
top-volume producer, which further gives our negotiating teams
significant leverage with regard to pricing and flexibility.
Vendor Evaluation
Oftentimes when a client has not had an independent consultant assist
with vendor or platform selection, they may be paying more at the fund
level than they realize. Many funds are loaded with commissions and
additional marketing expenses that are unknown to the client. Other
times, there are revenue-sharing agreements in place with certain
vendors that the client may not be aware of or taking advantage of. Our
approved vendors are run through a vigorous screening process to
qualify as a PremierSource vendor – fair and competitive pricing is a
large component of this selection process and oftentimes, changing
vendors alone can result in significant savings to our clients.
Ongoing Legal Support
When a client selects PremierSource, they get the added value and depth
of expertise of the approximately 10 ERISA attorneys in our model. We
have found that clients often prefer a second opinion relative to
ordinary legal and regulatory matters. Our model brings this added
support system without the traditional added cost.
Seamless Conversions
Our model has a proven track record for seamless and efficient plan
conversions. Because we have relationships with multiple vendors, our
systems are designed for accessing the sophisticated technology of
multiple providers. Our designated conversion teams focus exclusively
on conversions and employ the same team members for all conversions to
provide continuity of process, making for incredibly efficient
transition of assets and account balances. We have converted assets and
reporting in as little as 24 hours. Our targeted conversion period, as
well as our average conversion, is one week.