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PS: How did you feel about this response from the recordkeeper? David Roberts: We were certainly frustrated that they were unwilling to expedite the retirement income solution. I understand why they don’t want to do it, but at the end of the day, the solution that we discovered was able to offset the administrative costs, and the recordkeeper was still not willing to go through with it. PS: What are the next steps? Chepenik: My client has decided to take a formal look at the marketplace and see if there are vendors that are culturally committed to offering retirement income solutions. We sent RFPs [requests for proposals] to seven recordkeepers that said they would consider hosting this retirement income option in 2013. The core of the RFP is finding a company whose true focus—from top executives to the client relationship team and even the call center—is helping participants get to and through retirement. Whoever is committed to that is who will win this business. It’s about changing the process. My client still has anxiety about changing recordkeepers but is aware that this is what is best for participants. That is the reason they keep charging ahead. PS: So is this a deal breaker? Roberts: The retirement income solution itself is not going to dictate our move to a new recordkeeper. We’ll keep trying with the existing recordkeeper, but we’re considering our options at this point because we do believe the retirement income solution can provide a lot of added value to our participants. Our challenge is [finding] a recordkeeper that meets our overall needs. And a component of that is whether they will be willing to offer a retirement income solution in the future. We’ve been with [the same recordkeeper] since the creation of [our] company. We’re happy with what they provide outside of this, but they just haven’t come to the table with the retirement income solution we’re looking for. If another recordkeeper is willing to do it, and they can do everything our current recordkeeper can do and more while hosting our retirement income solution, we will switch. We understand that there are significant switching costs, so this is a significant decision for us and our participants, and we’re not taking it lightly. Everything’s got to be equal to or better than what we have. The retirement income solution is going to be a comparative advantage in our selection process. Chepenik: It’s like the Rolling Stones song says, “You can’t always get what you want, but if you try sometimes … you get what you need.” Right now, we [aren’t] getting what we want. [The client’s] current recordkeeper took them for granted and thought, “They’re not going to leave us.” I think it’s important for the recordkeepers to realize it’s not their money; it’s the participants’ money. The business we’re really in is stewardship. My job is to help [participants] make good decisions so they can make enough money to accomplish their hopes and dreams. Some of the retirement income options out there define that role as [being] a good steward.
PS: How did you feel about this response from the recordkeeper?
David Roberts: We were certainly frustrated that they were unwilling to expedite the retirement income solution. I understand why they don’t want to do it, but at the end of the day, the solution that we discovered was able to offset the administrative costs, and the recordkeeper was still not willing to go through with it.
PS: What are the next steps?
Chepenik: My client has decided to take a formal look at the marketplace and see if there are vendors that are culturally committed to offering retirement income solutions. We sent RFPs [requests for proposals] to seven recordkeepers that said they would consider hosting this retirement income option in 2013. The core of the RFP is finding a company whose true focus—from top executives to the client relationship team and even the call center—is helping participants get to and through retirement. Whoever is committed to that is who will win this business. It’s about changing the process. My client still has anxiety about changing recordkeepers but is aware that this is what is best for participants. That is the reason they keep charging ahead.
PS: So is this a deal breaker?
Roberts: The retirement income solution itself is not going to dictate our move to a new recordkeeper. We’ll keep trying with the existing recordkeeper, but we’re considering our options at this point because we do believe the retirement income solution can provide a lot of added value to our participants. Our challenge is [finding] a recordkeeper that meets our overall needs. And a component of that is whether they will be willing to offer a retirement income solution in the future. We’ve been with [the same recordkeeper] since the creation of [our] company. We’re happy with what they provide outside of this, but they just haven’t come to the table with the retirement income solution we’re looking for. If another recordkeeper is willing to do it, and they can do everything our current recordkeeper can do and more while hosting our retirement income solution, we will switch. We understand that there are significant switching costs, so this is a significant decision for us and our participants, and we’re not taking it lightly. Everything’s got to be equal to or better than what we have. The retirement income solution is going to be a comparative advantage in our selection process.
Chepenik: It’s like the Rolling Stones song says, “You can’t always get what you want, but if you try sometimes … you get what you need.” Right now, we [aren’t] getting what we want. [The client’s] current recordkeeper took them for granted and thought, “They’re not going to leave us.” I think it’s important for the recordkeepers to realize it’s not their money; it’s the participants’ money. The business we’re really in is stewardship. My job is to help [participants] make good decisions so they can make enough money to accomplish their hopes and dreams. Some of the retirement income options out there define that role as [being] a good steward.