Practice Management

Don't Miss the Tap-Ins

By Tom Foster

For financial advisors who service retirement plans, there are few better opportunities to increase assets under management over the long term than conducting regular plan reviews. It’s akin to hitting a "tap-in," an easy putt on the golf course.

Yet many advisors not only miss, they miss badly.

The 2016 MassMutual Retirement Plan Review Study1 shows that many financial advisors neglect to review the effectiveness of retirement plans as often as employers want and, when reviews do take place, they often fail to focus on what’s most important. For instance, nearly three in five (57 percent) plan sponsors want their advisor to review their retirement plan semiannually or more, something that only 44 percent of sponsors report currently takes place, according to the study.

When teeing up reviews, many advisors and employers fail to focus on what’s most important: determining whether a retirement plan is effective. The study finds that only one in four reviews prioritizes assessing whether employees are actually saving enough to retire. It’s like loading your clubs in your golf bag but leaving your putter at home.

It’s a missed opportunity. A review that determines employees are off-target on savings opens the door for initiatives to encourage action such as promotional campaigns, incorporating features such as automatic enrollment or auto escalation, and other asset-gathering methods. And many retirement plan providers offer tools that measure retirement readiness, both on an individual participant level as well as a plan level.

Don’t miss the tap-ins. Make sure you review the effectiveness of your clients’ retirement plans at least twice a year and determine if their employees are saving enough to be retirement ready.



Thomas Foster Jr. is Assistant Vice President, Strategy and Relationships, for MassMutual Retirement Services, a division of Massachusetts Mutual Life Insurance Co.

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This article is for informational purposes only and should not be construed as legal, investment, and/or tax advice. Please consult your own legal counsel and other experts regarding the specific application of the information set forth herein to your own plan and/or circumstances.