4 Key Questions Retirement Plan Advisors Should Ask Small-Business Owners


You want to help your clients with their retirement plans, but how? Yes, there are some tried-and-true methods that work well with almost everyone, but your clients are individuals, and they have their own preferences and expectations. Striking the right balance between asking enough questions and asking too many can be challenging. You need enough information to do a good job, but you don’t want to wade too deeply into the weeds. Lucky for you, we have put together a list of questions that will help you determine what your clients need and want — in a timely and efficient manner.

1.       What does retirement plan success mean to you?

No one wants to lose money, and certainly no one expects to, even though that is a definite possibility in the short term. Most retirement accounts grow 7%-10% per year — do your clients know this, and is this what they’re expecting?

Feel them out on this, and see what their definition of success is. Individual investors will see differing results, depending on how they allocate their funds and what level of risk they have taken, and it’s important for them to fully understand the choices they’re making.

Once you know what your clients expect, you can discuss with them ways of aligning their plan goals with their vision so they can meet their objectives and achieve the outcomes they expect.

2.       Are you getting all the tax breaks you deserve out of your retirement plan?

Getting a tax break isn’t the only reason small-business owners decide to sponsor a 401(k) plan, but it’s probably in the top three. So helping your clients to maximize their tax deductions will make their plan more efficient, and more profitable.

Whether they decide to sponsor a 401(k) plan, offer the opportunity to open an IRA or the Roth versions of either of these determines whether employees make contributions to their retirement plan before taxes or after. But money the employer spends on retirement benefits is tax deductible regardless. Remind your clients that any contributions they make to their employees’ retirement funds only helps their bottom line. Additionally, because these contributions are not subject to payroll taxes, and because the money just grows over time, it’s one of the cheapest — and most valuable — ways to compensate employees.

Sometimes it’s hard for small-business owners to reach that tipping point where they finally decide to get their plan up and running, but you may be able to motivate them by explaining to them how they will benefit with substantial tax credits simply for starting up their plan. Don’t overlook any strategies to maximize tax breaks for your clients.

3.       What irks you the most about your retirement savings plan?

When you talk to your clients about their pain points related to their retirement savings plan, expect to hear about a lack of support and lots of wasted time on housekeeping matters and paperwork. When potential plan sponsors read about these types of headaches online, it can deter them from moving ahead with their idea to start a retirement plan at their business.

401GO’s main objective is to help small businesses get around the expense and complications that come with sponsoring a 401(k) plan, but with this streamlined simplicity also comes the type and level of responsivity that no one will ever get from the likes of Charles Schwab. Although we work directly with small business owners, we also work with financial advisors. We want you to come to us when you’re helping your clients start up their new retirement plans. We even match financial advisors to business owners looking for help because we know plans perform 15% better when a financial advisor is involved.

Other common complaints from plan sponsors include unnecessary complications — an issue you’ll never have at 401GO — and errors. No one can bat a thousand every day, but we come close. And what’s even more important is when a mistake is made, we’re on it immediately, working until it’s fixed.

Regardless of what your clients’ complaints are about their plan or their plan administrator, you can’t fix them if you don’t know about them, so don’t skip over this critical step.

4.       When can you meet to review your retirement plan’s progress?

Too often, a retirement plan becomes set it and forget it. We actually advocate for that on our site, because we know a lot of small-business owners don’t want to put the time and energy into a retirement plan since it would end up taking their attention away from their business. But financial advisors can provide clients a crucial edge that those who don’t benefit from your services can’t get.

And while we provide a set-it-and-forget-it service, we also provide valuable tools to financial advisors and others who want to use them, including extensive reports on contribution levels, earnings and losses and innumerable other important facts that should be considered for discussion at quarterly or annual reviews. We provide dashboards that allow you to monitor the progress of your clients’ plans, and you can compare the plans you manage, such as the size and health of each. You can even access individual participant accounts.

Such meetings are great for keeping your clients informed, but they’re also useful for seeing where changes might need to be made to get your client’s plan more in line with their goals and expectations.

More Knowledge, Greater Success

The above questions are just a sampling of how you can learn more from your clients in order to serve them better — and the better service you provide, the happier they are and the more clients you can expect to come knocking at your door, trying to find out how to get some of what your other clients already have.

To learn more about how you can serve your clients through a partnership with 401GO, contact us today.

Learn more about our 401(k) options optimized for small and medium sized businesses.

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Karli Maughan
With years of retirement industry experience, Karli is passionate about helping financial advisors get the best for their small business clients.

Learn more about our 401(k) options optimized for small and medium sized businesses.

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