New Alliance Offers Sponsors, TPAs A New Option

“Customers will be able to choose from a menu of options, based upon what will best serve their individually-tailored retirement plan,” according to J. Lake Killgore, Chief Operating Officer of Walker MacRae. 

Killgore told PLANSPONSOR.com, “Part of the reason some plan sponsors have been held captive to insurance products is because their TPAs couldn’t get these services elsewhere.”

The TranSend product purports to not only disclose, but to return these revenue sharing funds to the plan – either through a reimbursement for plan expenses, or as an additional income allocation to plan participants – at the plan sponsor’s discretion.

Unified Trust will provide unbundled services to Walker MacRae customers, including:

• Directed and Discretionary Trustee Services
• Quarterly Fiduciary Monitoring and Reporting
• Recordkeeping
• Access to all, some, or none of the institutional investments of Unified Trust
• Daily valuation recordkeeping services
• Web access for third party administrators that do not have systems in-house
• Revenue sharing/transparent pricing

Price Slice

For several years now, it has been customary for recordkeepers to get a “scrape”, or share, of mutual fund revenues, both those detailed as shareholder servicing costs noted in the mutual fund prospectus, and others, which can include “finders” fees. 

The rationale is that the recordkeeper’s role as intermediary in dealing with individual 401(k) shareholders replaces, or at least diminishes, the need for the mutual fund complex to offer those services. 

For recordkeepers, this revenue sharing has provided a means of subsidizing the cost of their operations, offering plan sponsors an apparently less expensive product.