Why Many Financial Advisors Prefer Unbundled Plans versus Bundled Plans (in their own words)

 In Bundled, Financial Advisor, Interview, TPA, Unbundled

The complexity of managing and maintaining a retirement plan is well-known. It has led many business owners and plan sponsors to seek help from both bundled service providers and unbundled models.

What should be talked about more, however, is the impact an outstanding TPA can have on the health and growth of a financial advisor’s book of business. And while, as a TPA, CRS may intrinsically believe that unbundled plans have higher satisfaction and retention, we recently sat down with two tenured financial advisors to hear, in their own words, what value a TPA brings to their practice.

There are a few plans that I’m partnered with other advisors on where they use a different TPA. But if I’m the lead advisor on a retirement plan, and I have my own choice, at this point, CRS is the only TPA I would consider working with,” Michael, an Ohio-based financial advisor with a large Independent Advisory firm, expressed.

Here is more from our conversation with Michael.

It was a little bit of a leap of faith. I would use bundled versus unbundled on an as-needed basis. If I felt the client had the complexity to where they needed more hands-on service from a TPA, I would use unbundled. Now, I will say that a lot of that was prior to me interacting with CRS, and candidly, I would rather choose unbundled with CRS than a bundled plan because I get the value as the advisor.”

I think working with a TPA is an enhancement across every plan from a service standpoint with respect to the dedicated point of contact you have at CRS. Depending on the size of the plan, many recordkeepers may not offer dedication, and you’re basically working with a generic call center. So, dedication is a major enhancement for both me and the client, especially when it comes to research and various issues that you may encounter with the plan.”

Michael also said this in discussing if there is a positive difference in having a TPA present during finals presentations.

“There is, especially if you get into a conversation with a committee or a plan sponsor who is very detail-oriented and asks a lot of technical questions. While I certainly know a fair amount about retirement plans, I don’t pretend to be a technical expert. I’m seasoned in investments much more than rules and regulations and plan compliance and administration. There’s definitely a benefit to having someone from CRS involved in those conversations to speak more authoritatively.”

We also spoke by phone with Mel, an Ohio 401(k) Financial Advisor, who mentioned, “20% of my business is with CRS. In the next two years, CRS will have 100% of my business!

What has been your experience with bundled plan business?

I found that bundled plans are reactive and not proactive. I’ve run into issues that have been expensive for my client to rectify, and the name CRS kept coming up. They are very proactive, and each client has an account manager. I’ve definitely seen more quality work and fewer errors. They have policies in place to take care of clients.”

In discussing how else CRS supports his book of business, Mel told us the following.

I like their local touch and look forward to bringing CRS to meet my clients. My CRS sales rep fits my definition of “high standards.” He’s an extremely polished presenter and knows his stuff. Once you have excellent service, you don’t move your plans.”

In Summary

A TPA is a vital asset to a financial advisor’s business.

If you’d like to learn more about our experience, competitive pricing, or robust technology, don’t hesitate to get in touch and request a proposal here>>.

Written by Angela Murphy, JustPositionIt Consulting

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