PA: What is your mission statement?

Channel Financial: “Doing what matters today—for tomorrow.” A big portion of our industry is putting the investment cart ahead of the savings horse and not taking into account the behavioral wants and needs of most Americans. Channel Financial believes what matters most today is making it as easy as possible for people to save, save more and save wisely.

PA: What have you done in the past year to improve participants’ retirement readiness?

CF: We are having the biggest impact on retirement readiness by educating and empowering our plan sponsors on the use of behavioral finance tools. Most plans are designed so that an employee needs to take some sort of action to be in the plan. Our industry has been built around this model, and the success of this approach is mixed. This old model continues to try to teach people to pilot their own financial journey when many Americans have little to no interest in learning the subject matter. We are having plan sponsors reconsider this approach and embrace the power of behavioral tools to seek better participant outcomes.

We make plan sponsors aware that they are ultimately choice and information architects that can greatly impact the outcomes of their participants in the plan. Some of our clients have more than tripled their participation rates and have more than doubled the amount of deferrals into their plans.

PA: How have you been able to lower fees for clients?

CF: We have been conducting fee benchmarking and revenue-sharing studies on our clients’ plans for more than 10 years. Today, it is relatively easy for us to maintain a reasonable fee structure for our clients.

PA: Describe any particularly noteworthy investment initiatives you have led with your customer base in the past 12 months.

CF: The selection and monitoring of a qualified default investment alternative (QDIA) becomes critical when implementing automatic features in a plan. The normal factors that our industry uses to evaluate traditional core investment options are usually inappropriate for evaluating target-date solutions. We help our clients put in processes using appropriate benchmarks and metrics for selecting and monitoring target-date or model allocation solutions that fit the demographics of their participant base.

PA: Please describe any special education or communication initiatives you’ve undertaken with plan sponsors or participants.

CF: Most of the communications in our industry assume the participant needs to take action to be in the plan. However, if you reframe the choices in a plan correctly, you should also adjust many of the communications and messages to the participant base.

We are having different conversations with employees who are already on the path to saving—about saving more and saving wisely for their future. Our discussions with this type of employee are usually around providing them affirmation that they are on the right path. We then can focus on using the participants’ time and energy to address other financial issues. We also provide a comprehensive financial wellness curriculum for those employees who desire to become engaged in a planning process to address issues such as investment concepts, college funding, insurance exposures, tax management and estate conservation.

PA: As a retirement plan adviser, what do you take the most pride in?

CF: We have not been afraid to challenge plan sponsors to rethink the traditional “participant needs to take action” model. We have helped a number of plan sponsors using behavioral tools to design a plan to impact their employees’ future today. We get excited when we help a plan sponsor like this triple its participation rates and double its average deferral rates.

BUSINESS AT A GLANCE

Plan assets under advisement: $778 million

Median plan size (in assets): $7.3 million

Total plans under advisement: 133

Total participants in plans served: 15,088