Deals & People July 21, 2014

MassMutual Names New Relationship Managers

MassMutual Retirement Services has appointed eight new relationship managers to further support retirement plan sponsor clients.
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These managers will be responsible for parts of New York, New Jersey, New England, California, Arizona, Nevada, Oregon, Washington and Alaska. The new appointments are part of a plan to increase the number of relationship managers from the current staff of 98 to a new total of 110 to help keep pace with sales efforts, says Una Morabito, senior vice president of client management for MassMutual Retirement.

The new relationship managers will be responsible for helping employers make the most of their 401(k), 457 and 403(b) defined contribution retirement plans, the firm says. The relationship managers work with employer’s on-staff decisionmakers, investment advisers, attorneys and accountants to help manage plans as effectively as possible.

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“MassMutual’s relationship managers are connection points for our network of support for employers, financial advisers and third party administrators,” says Morabito, who is based in Enfield, Connecticut. “Our relationship managers are seasoned professionals who work to make retirement plans as effective as possible and help employees prepare for retirement on their own terms.”

The new relationship managers and their territories are as follows:

Gary Bozin was named as a senior relationship manager for government-sponsored retirement plans in northern California, Oregon, Washington and Alaska. He reports to Amy Humphrey, assistant vice president, government markets. Before MassMutual, Bozin served in a variety of roles at ING, most recently as a regional vice president serving tax-exempt retirement plans. He joined ING after serving as a senior account executive for defined contribution retirement plan sales at The Hartford and as an insurance field underwriter at Mutual of New York. Bozin has 30 years of experience in financial services, earned a bachelor’s of science degree at San Francisco State University, and has FINRA Series 7, 24, 65 and 63 licenses.

Kami Falcione was named as a relationship manager for New England, serving retirement plans that rely on third-party administrators (TPAs). She reports to Craig Haase, assistant vice president, TPA Alliance. Falcione was a client relationship manager for 401(k) plans at Great West Retirement Services. She also held previous relationship management positions at DST Retirement Solutions and Bank of America, and has a total of 16 years of experience in the financial services industry. A graduate of Westfield State College, she holds FINRA Series 6 and 63 licenses.

Gregory Forte was named as a senior relationship manager for government plans in New York and New England. He reports to Amy Humphrey. Forte comes to MassMutual from ING, where he served as a client relationship manager for large corporate plans and, earlier, government plans. Previously, he worked at Putnam and Watson Wyatt and has 24 years of experience in the retirement plans marketplace. He earned a bachelor’s of science degree at Merrimack College.

Juan Dario Gomez was named as a senior relationship manager for government plans in central and southern California after serving as a retirement education specialist at MassMutual and The Hartford. He reports to Amy Humphrey. Previously, Gomez was a financial consultant for Bank of the West. He earned a bachelor's of science degree from California State University, Fresno, and holds FINRA Series 7 and 66 licenses.

Bridget Graham was named as a senior relationship manager for corporate plans in the Boston region. She reports to M. Palmer Whitney, assistant vice president in the firm's northeast division. Before joining MassMutual, Graham worked at The Hartford as a sales director for retirement plans. She also worked as a retirement education specialist, regional sales consultant and sales support associate while at The Hartford. She holds FINRA Series 6 and 63 licenses.

Shawn McGrane was named senior relationship manager for corporate plans in a territory consisting of New York City, Long Island and southern New Jersey. He reports to M. Palmer Whitney. McGrane served as a sales consultant for MassMutual Retirement and in sales and sales support roles for The Hartford’s Retirement Services Group. He earned a bachelor's of science degree from the University of Tampa and holds FINRA Series 6 and 63 licenses.

Denise Stratton was named as a senior relationship manager for corporate plans in New England and has 10 years of relationship management experience. She reports to M. Palmer Whitney. Stratton previously worked at ING as a client relationship manager and retirement plan manager and, before that, as a senior account manager at MassMutual. She has a bachelor's of arts degree from Framingham State College and a M.B.A. from the University of Massachusetts.

Kristin Stroth was named as a senior relationship manager for retirement plans served by TPAs in southern California, Nevada and Arizona. She reports to Phil Maness, assistant vice president, TPA Alliance. Previously, Stroth served in similar roles at Lockton Financial Advisors, Transamerica and John Hancock Retirement Plan Services. Stroth earned a bachelor's of arts degree at the University of Southern California and holds FINRA Series 6, 63 and 65 licenses.

More information about MassMutual’s Retirement Services Division is available here.

The Markets July 18, 2014

Equity Overweighting Likely as 401(k)s See Record Balances

Savings in defined contribution (DC) retirement plan accounts recordkept by Fidelity grew 12.9% in the last year, to an average balance of $91,000.
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The average balance is up from $80,600 at the end of the second quarter 2013, Fidelity says. The figure includes all employees participating in workplace retirement plans served by Fidelity, regardless of career stage. For those employees who have been active in a workplace 401(k) retirement plan for 10 years or longer, average balances rose 15% per year over the past decade to reach $246,200, according to a quarterly Fidelity analysis.

Jeanne Thompson, vice president of thought leadership for Fidelity Investments, says the growth has caused a significant amount of unintentional style drift within retirement portfolios.

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“I actually went back into the data and looked at the average percent equity our participants are holding, and right now it’s up at 73% of assets, which includes equity assets held in professionally managed options like target-date funds,” Thompson tells PLANADVISER. “Going back to 2010, they were only holding 64% in equity. This suggests to me that it’s likely many people are overweight on equities without realizing it.”

Thompson says the more distressing fact she pulled from the data is this: Of the approximately 63% of workplace retirement investors that Fidelity classifies as “do-it-yourself” investors—i.e., those who create and manage their own portfolios rather than buy into a managed account or target-date option—many have not checked on their accounts even once in the last two years.

“They haven’t gone in to do a fund exchange or reset their asset allocation or do anything,” Thompson says. “With the markets rising pretty steadily over the last two years, again many are overweight in equities without realizing it. Those people doing it on their own, they need to take responsibility for rebalancing and taking charge of their investments, or they could suffer more than they have to should the market experience a correction. We are strongly recommending that folks go in and make sure they’re only taking on as much risk as they are comfortable with in case the markets fall.”

Individual retirement account (IRA) investors experienced similar growth in the last 12 months, Fidelity says. The average balance of Fidelity IRAs now stands at a record high $92,600, also nearly a 15% increase over the average balance from a year ago.

Thompson points to strong stock market gains as the principal factor underlying the record-setting balance growth. Indeed, the analysis shows as much as 77% of the one-year 401(k) average balance increase was due to the equity markets. Just 23% of the growth, in turn, was based on combined employee and employer contributions.

Fidelity 401(k) Infographic

 

But Thompson is quick to point out that this is out of the ordinary.

“Looking at contributions over the last 10 year period, the data tells a much different story,” she explains. “We see that since 2004, 55% of the net account growth was due to the markets, and 45% was due to contributions. We don’t necessarily have the data needed to look back farther, but it’s certainly possible that over a longer term the impact of contributions will be equal to or even outweigh the impact of investment returns.”

Thompson says this fact “really highlights the role the markets have played in the last year, but over the long term, it’s much more equal between the markets and contributions.” Therefore it’s critical for plan sponsors and advisers to remind participants that it’s not just the investment decisions or the asset allocations underlying growth and successful outcomes, she continues.

“Long-term success is just as much about maintaining high contribution levels as well,” she adds. “If you look at periods like 2008 and 2009, when the markets were not doing well, it was zero-return environment at best for many investors. Any growth in account balances during that time was driven by contributions.”

Interestingly, Thompson says, Fidelity’s data shows employee contribution levels do not respond significantly to market crashes or surges. Contributions by employees to 401(k)s accounts averaged $6,050 over the past year, with an average of $3,540 being contributed in the form of employer matches. Both figures are rising, Thompson says, albeit slowly.

“That is actually encouraging to us,” she says. “Employees seem to maintain their contributions regardless of what the markets are doing, and again that’s critical for long-term success. As the markets are going down, as a long-term investor you can buy in at a lower price and then later on reap the benefits of dollar cost averaging and compounding. If you’re only going to contribute when the market is high, you’re chasing performance. Especially with retirement being a 40 year proposition, potentially. You need to maintain some equity allocation and you need to keep contributing even in the down markets.”

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