Retirement Plan Advisors

Written by Jacey Harmon
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Retirement plan advisors come in all sorts of different sizes. They may range in size from a large company like Fidelity to a small local independent advisor. Though one may want to gravitate towards a larger company, your local independent advisor should not be forgotten. Both types of retirement plan advisors have benefits and drawbacks.

Aspects of Large and Small Retirement Plan Advisors

Large companies offer a variety of investment services for individual investors and businesses alike. The benefits of the large retirement plan advisors are quite simple: psychological security and typically lower costs. It also stands to reason that because of their size they can offer cheaper fees because of the sheer number of clients that they have, which brings us to the drawbacks of larger companies.

As with everything else when you pay a lower price, you often get a lower quality product. In the case of retirement plan advisors that lower product may be attention and service. Many larger companies have millions of clients that simply cannot be handled on a detailed individual basis. Let's face it--the goal of these companies is to grow earnings for their share holders. They do this by pushing sales quotas on their representatives, which in turn cause their representatives to have a large number of clients. A large number of clients, in turn, equal a lower quality of individual service.

Small independent advisors are likely found in many offices in your area. Some people may not consider these independent advisors because of their small size. In fact, many smaller retirement plan advisors work with larger companies to provide custody of their client's funds. What this means is your money is held by a large company like Fidelity, while you work closely with the independent advisor.

A smaller advisor may have larger fees than their larger counterparts, but that is not necessarily a bad thing. Independent advisors are not publicly traded companies that have an obligation to grow earnings for their shareholders. This means that an independent advisor can get by with fewer clients than their larger counterparts. This equals a higher degree of personal attention than what you may expect to get from a larger company.

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It shows how hungry cneusmors are for knowledge of personal finance contrary to what MAS thinks.People are clueless about finance and insurance and yet MAS always talks about 'informed decision'. There is no way for cneusmors to make informed decision on life insurance or investment and yet many many cneusmors are product sold without advice, ie. being pushed products.First the insurance salesmen are themselves poorly educated, unqualified and incompetent how could they impart knowledge of finance to cneusmors to make informed decision? It is unfair , right? It is the onus and fiduciary duty of insurance agents to ensure that the products are suitable to meet the clients' needs and goals and not left to the customers to find out many years down the road. MAS must charge and punish them and if possible revoke the license if they are found guilty of poor and unsuitable recommendation.During MAS mystery shopping survey many agents were found to fall short of the standard and in one case an old lady of 60+ was sold a regular ILP which breaks even at 15th to 20th year and yet the agent's GM came out to defend him that his recommendation was suitable.You can see how incompetent the GM was. Is MAS condoning to the practice of this insurer? I wonder how many victims of this nature have been ignored.People must educate themselves to protect themselves from incompetent and product pushing agents. They are not qualified. Why do you want to pay so high commission to them for the products without advice? You might as well buy from the supermarket shelves without paying a cent when one insurance company goes on online to market whole life, endowment, regular ILPs etc soon.Before that educate yourself by attending Mr. TanKL's talks held every now and then, even for a small fee.Protect yourself by educating yourself and save tons of commissions wasted on insurance agents.