Perspectives : Participant Experience | June 03, 2022

Let's talk about advice—your most valuable asset

In addition to fiduciary support and plan design experience, your clients are becoming increasingly more reliant on your investment advice as their advisor. While navigating daily administrative duties, they look to your expertise to bring consistent, critical thinking to their pursuit of financial well-being for their employees. And, as you know, this is an area where you can shine.

Your value in motion

Even in the small-to-midsize business sector, plan sponsors are realizing they can't do it all. They need a partner to help share the load and put their retirement plan on par with those offered by larger companies. What's more, they understand that a quality plan can serve as an important tool to help attract and retain the level of talent often drawn to big corporations with deeper pockets. The advice you give can be categorized into three distinct areas:

Behavioral coaching. You encourage your clients not to give in to emotion. While market turbulence may make them weak in the knees, you remind them of their long-term goals and the investment strategy they developed—with your assistance—to get their company's retirement plan through a range of fluctuation.

Portfolio construction. Your clients' employees look forward to retiring with confidence. That's why it's so important that plan sponsors have an ally adept at building and maintaining a plan with an appropriate mix of broadly diversified stock and bond funds—in addition to cash investments. Your ability to structure a portfolio that is cost-effective, tax-efficient, and focused on total returns is key to the plan's overall success.

Wealth management. Your depth of expertise really comes into play when offering advice on topics such as tax planning, estate planning, and retirement spending. For example, your clients rely on you to incorporate tax-smart investment strategies into the fund selection and allocation processes—all to help manage risk and potentially boost performance.

Your role in financial wellness

Financial advisors are being tasked with evaluating the effectiveness and costs of infusing financial wellness into the retirement plans they've helped design. Financial wellness isn't some marketing ploy. It's an aspirational choice to deliver a host of life-enhancing benefits and services—beyond the basic plan offering—to participants. These may include programs that focus on debt management, emergency savings, retirement planning, household budgeting, health care costs, college planning, and student loan payoff strategies.

And properly implementing this directive requires a wealth of advice from trusted financial advisors.

Below is a quick look at our advice framework highlighting the components of the value you can offer, including those contributions to your clients' employees' overall financial well-being.

Our value framework for advice

Source: Paulo A. Costa, Ph.D., and Jane E. Henshaw. "Quantifying the Investor's View on the Value of Human and Robo-Advice." Vanguard, 2022.

Build on what you know

As a steward of financial advice, you grow your value through the many relationships you forge and the guidance you give to plan sponsors. Your success story is a chapter in our own, a rich narrative inhabited by the diverse goals of plan sponsors and their participants. You could say that together, we're a part of an interconnected relationship—joined by the advice you extend to help promote a lifetime of financial well-being.

Thank you for carrying forth the Vanguard name and all that that entails. If you have questions or need support, please reach out to your Vanguard Retirement Plan Access™ regional director.


Note:

  • All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income.