Legg Mason Creates Retirement Think Tank

The message at the first gathering of the Council was clear: the industry needs to come up with new ideas in order to help the American worker save more money for retirement.  Those ideas cannot be found in products alone – there needs to be a more “holistic approach” moving forward. There was a consensus that the industry is on the “precipice of change,” and that change can either be extremely positive or negative – the council’s goal is to ensure the change is positive.

The 14 Council members are:

• Ted Benna, President of Malvern Benefits Corporation 401(k) Association
• Thomas Clark, Jr., President, Lockton Financial Group
• Paul D’Aiutolo, Vice President, UBS Wealth Management
• Charles Epstein, Founder, The 401(k) Coach Program
• Robert L. Francis, Chief Operating Officer, National Retirement Partners
• Joseph Frustaglio, Vice President, Retirement Plans Sales, National Sales Manager, Nationwide
• Gary Kleinschmidt, Head of Retirement Specialists, Legg Mason
• Dave Master, Managing Director Strategy and Business Development, Legg Mason
• Joseph Masterson, Senior Vice President, Diversified Investment Advisors
• Joe Mrozek, National Sales Manager – Retirement, Bank of America Merrill Lynch
• Edward O’Connor, Managing Director, Head of Retirement Services, Morgan Stanley Smith Barney
• Michael Shamburger, Vice President, National Sales Manager 401k, The Hartford Financial Services Group
• Scott Sides, Senior Vice President& Corporate Benefits Director, Morgan Stanley Smith Barney
• Marcia Wagner, Managing Partner, Wagner Law Group

The reality is, none of the legs on the traditional “three-legged stool” of retirement are strong enough, said Wagner.  The industry needs to break down this stool and come up with ideas that encompass “innovative simplicity,” Francis remarked.  He said that the industry has been paralyzed by complexity and we need to get back to the bottom line: save more money.   

“Save more money” was echoed around the room.  Several members said the biggest change that needs to come to the industry is more self-discipline from the participants.  They have the “responsibility and opportunity” to take control of their future, said O’Connor, two things that are equal parts exciting and daunting.   

“Coach” Epstein painted this metaphor for the group.  He said peoples’ two biggest assets are their home and their retirement savings.  People take their home mortgage seriously – they have a strict plan to pay off the loan in 30 years; they respect it with utmost diligence.  Retirement savings, on the other hand, are treated like a casino, he said.  What the industry needs is a retirement mortgage – you have 40 years to get to this amount of money – contribute to your plan as if you were paying your mortgage.