Client Snapshot

One hundred employee investors in the pension fund of an organization needed guidance in how to plan for their individual retirements.

Situation and Outcome

The company’s employees enjoy six-figure incomes with an attractive pension benefit.  But they had no advisor to help educate them on plan options and choices.  Wescott was introduced to the organization through plan administrations’ legal counsel, and in 2006 was named to the account.  Today, Wescott works closely with the plan’s finance committee and administrators.

Wescott works directly with the custodian brokerage to provide model allocations and risk profiles.  Additionally, customized models, quarterly commentaries and annual research documents are posted to the website.  Wescott also works with the finance committee on what assets the plan will accept, and hosts annual educational meetings for the employees to better their understanding of the plan and its offerings.

“Simplicity” is the central message Wescott tries to impart on the participants.  “Cheat sheets” posted online show them how to interact with the platform.  Access to research and education has been simplified to improve adoption.  Employees are permitted to have their assets managed elsewhere, and have slowly learned to appreciate the research and due diligence of the plan’s platform and have moved their assets over to Wescott’ s models.  Today, a growing number of employees reach out regularly to their Wescott advisors for ongoing investment guidance.

Wescott fiduciary goals run deep into the organization.  In working with the plan’s finance committee and executive benefits administrator, Wescott discovered early on that the underlying fund fees being paid were too high.  So the firm reviewed the platform and convinced the plan administrators to put Wescott managers on it.  Eventually, the employer selected Wescott as their investment advisor.

Lessons Learned

Self-directed retirement plan investors often lack the financial savvy to make wise long-term investment decisions.  It was important that the Wescott team offer their services, educate employees about the process, and dispel perceptions of complexity where simplicity is more the norm.