Magazine

cover story | PLANADVISER March/April 2009

2009 Retirement Plan Adviser of the Year

Steven Dimitriou, Mayflower Advisors, LLC (Boston, Massachusetts)

By PLANADVISER Staff editors@assetinternational.com | March/April 2009

As a Managing Partner at Mayflower Advisors in Boston, Steven Dimitriou is passionate about independence and flexibility across all aspects of his business, including vendor selection, plan design, and fund selection, among other things. That dedication has held his business, and Mayflower Advisors, in good stead over the past seven years, and left him with few regrets. In fact, he says, looking back, if he could have done something differently, he notes only that he “probably would have gone independent sooner."

“We will never be self-serving," he says. “If the proper choice for a client is one that compensates us less, then that is what we suggest. We are fortunate to have a sizeable book of business that allows us to eliminate conflicts and not worry about maximizing revenue on any one deal."

Mayflower’s mission is very participant-centered: “Our focus is on the participants of our plans first. All of our guidance and advice to our plan sponsors is geared toward what is best for participants. We firmly believe that new participants in a 401(k) plan are as important as any one of our individual high-net-worth clients. They have the same right to our time, our guidance, and our expertise," he says.

Dimitriou’s services are comprehensive and, coupled with an independent approach, Mayflower is able to work with all vendors. That freedom and flexibility are important to his model. “What is most important is finding what is right for the client,’ he explains. When taking over or benchmarking a client plan, he says he generally tries to avoid a conversion, preferring instead to keep the existing platform in place, while trying to find a way to lower costs. However, he notes, “If it is a truly inferior platform, we will pound the table and try to convince the committee to move to a new provider." Further, Dimitriou says he signs on as a fiduciary to his client plans because “signing on as a fiduciary puts the clients’ mind at ease that there are no hidden objectives."

How He Got Here

This may not be the job path Dimitriou envisioned when he graduated from Colby College with a B.A. in both Honors Physics and Economics. Right out of college, he was working at an insurance company in Massachusetts, and found retirement plans interesting. He then decided to take it upon himself to learn about them, spending his time reading the Internal Revenue Code and researching the regulations pertaining to qualified programs. Within a year, he says, he was the go-to person in the region for people interested in retirement plans.

However, he knew he needed to learn more, and so he moved to Massachusetts Financial Services (MFS), Inc., in Boston in 1993, just as the firm was starting to take off with its recordkeeping program. He sat on the firm’s retirement sales desk, where he stayed for a couple of years, before moving on to Alex Brown and Sons in Baltimore, where he served as a vice president responsible for retirement sales and service in the Northeast and Midwest. He then got an attractive offer from boutique investment bank and advisory firm H.C. Wainwright & Co., Inc., and Dimitriou joined that firm in 1999. As a managing director, he was responsible for the Retail Products division, which included the retirement plan services and mutual fund research departments.

Dimitriou eventually left the firm to found Mayflower Advisors in 2002. Mayflower has grown to nine people now, with the business split 50/50 between retirement plan and personal high-net-worth advisory work. Dimitriou handles all of the firm’s corporate business, mostly retirement plans (the firm has more than 50 plan clients, with an average size of $9 million) with a little bit of legacy corporate 529 plan work, and has three staff assigned to support him with the servicing of plan clients. He says he wants to be the point of contact for the plan sponsor for any service-related issue; “if we know what’s going on,’ he says, the firm can prevent it from escalating or from happening in the first place.

Education

Dimitriou is passionate about employee education and participant service: “I am a bit of a geek with the analysis, but really the most fun part is being in front of employees." Mayflower stresses education more than anything, he notes.

More recently, Dimitriou’s education efforts have been challenged by the markets and heightened participant concerns. Clients have been much more curious about what is happening in the marketplace, and have asked for increased education, he says.

Mayflower does both enrollment and education meetings, and does so via both one-on-one or group meetings. They also will offer targeted education for varying demographics if requested. Dimitriou estimates that only about one out of every seven clients asks for such tailored education services. However, he notes that, occasionally, companies ask for a split of meetings for higher-paid employees and rank and file, or sometimes a meeting targeted specifically at the younger people trying to get them interested in the plan.

“We take particular pride in our hands-on approach to employee education," he says. “We will meet regularly with participants in group and individual sessions and try to evolve our curriculum continuously. This keeps participants engaged and leads to much more rational behavior."

The real trend Mayflower saw in education in 2008 was an expansion outside of its traditional client base. The firm has begun offering à la carte programs that cover both financial planning and investing topics to companies that want to educate employees. The curriculum is tailored to the client, and is progressive, with segments named 101, 201, 301, and further. Each company retains Mayflower for at least one year, having the firm progress through the curriculum with various groups of participants.

Mayflower has five “pure" education clients, for which the firm does not have any responsibility for the client’s retirement plan administration, though the latter is an opportunity Dimitriou expects to grow in 2009. Recently, a university agreed to bring Mayflower in to give financial education to all its employees, a program that Dimitriou expects will take years to deliver completely and one that he hopes to replicate at other universities—and possibly biotech firms—in the Boston area. Further, because participants “tune you out on the “rah rah 401(k)" stuff after a while," Dimitriou comments, Mayflower also has taken its education curriculum back to its current 401(k) and retirement plan clients to keep the traditional participant education offered at those firms fresh.

The educational outreach does not end there; Mayflower also has been involved in the community. Dimitriou says the bulk of his team has become involved in the Massachusetts chapter of Jump$tart, a national not-for-profit organization dedicated to promoting financial education curricula in our schools. Further, the company organized seminars and managed to get the City of Boston to declare April 2008 as Financial Literacy Month.

What does the future hold for Dimitriou and Mayflower? Dimitriou says he plans to bring a couple of new advisers into the group, and, though he admits he would like to continue adding plans, he says he is “cautious about growth." As a result of the highly service-intensive delivery, Mayflower rarely takes on more than five clients in a year. Because all of the company’s business is derived from referrals, “we’re very fortunate to be growing, but it is most important to hold onto the clients we have," he notes.