Cetera Leans Into Wealth Expertise in 401(k) Participant Programming

Jon Anderson, head of workplace and retirement plan solutions at Cetera Financial Group, is quick to say that the firm’s network of more than 12,000 financial advisers is focused on wealth management. That fact, he argues, is not a detractor from serving the modern 401(k) marketplace, but a competitive benefit.

“If I’m a wealth management adviser, my whole world is around working with individuals, so I have a unique perspective into working with a participant that I would argue is different than a plan adviser’s perspective,” says Anderson. “When you’re a wealth manager, you think about individuals always—that’s your primary M.O.”

The focus on how to best provide personalized service to plan participants is part of a strategy Cetera has been emphasizing over the past year, when Anderson moved from a role overseeing general adviser growth back to the retirement plan focus he had when joining the firm more than a decade ago.

The plan advisory world over that 10-year period, Anderson believes, has changed drastically, with plan sponsors seeking out participant services alongside the usual fees, funds and fiduciary hallmarks of retirement plan advising.

“Plan advisers are having to show business owners how they can provide the same services to all the participants,” he says. “You can’t cherry-pick the individuals on who you want to work with and win the client. … “You’ve got to get able to provide services to all employees, and advisers are having to prove that value.”

Jon Anderson

These days, advisers can win or lose finalist presentations with plan sponsors based purely on whether they can offer some kind of participant experience, Anderson says. How that can and should be done, however, is a story yet to be written—with Anderson agreeing that participant engagement and uptake on many programs, whether free or not, can be very low.

“This is where the crux of the convergence is: wealth management advisers that think of individual lives—how do we take that sort of experience and scale it to the plan to get all participants a unique, customized experience?” he says. “That’s how you’ll drive engagement.”

Retirement, Wealth and Back

Anderson came to Cetera nearly 11 years ago to build out a retirement plan unit that would support its network of financial advisers with retirement plan advisement. The focus was on advisers who oversaw a few plans from wealth clients with small businesses or who had the opportunity to win them.

After a few years setting up that system, he shifted to work on the organization’s “Growth360” initiative to drive organic client growth among its network of wealth advisers. As part of that project, the firm looked at advisers bringing in the most business. One insight they uncovered, Anderson says, was that the majority of the most successful advisers worked in qualified retirement plans along with wealth management.

“What are the most, fastest impact drivers of growth in an adviser’s practice? Retirement plans are a key component,” he says.

This information contributed to Anderson shifting back to a retirement plan and workplace leadership role, as well as an overall focus on qualified retirement plan advisement from the top of leadership on down, according to Anderson. That was likely helped along in May of 2023, when Cetera Holdings hired Mike Durbin as CEO from a role he held at Fidelity Investments as head of its institutional business that partnered with financial advisers.

Now, Anderson believes, rather than deriding wealth managers who manage three or four small qualified plans, the retirement industry should be leaning into their expertise of individual financial advice and guidance. Meanwhile, those advisers should be leveraging their close relationships with business-owning clients.

“It creates an interesting marketplace where we not only have to support the retirement plan specialists—which we have done—but also figure out ways to have the wealth management adviser service the plan in a way that is not risky, that they are meeting their fiduciary duty to the plan sponsor,” he says.

Competitive Space

The space Cetera is competing in is crowded. Insurance benefit aggregators and private equity are backing a roster of firms acquiring wealth managers to create national networks. Firms like CAPTRUST, SageView Advisory Group and OneDigital, which started out in plan advisement, also have their participant education and engagement programs in place, with large books of qualified plan assets already under administration.

But Anderson sees Cetera as being able to lead with its offering, which it calls “wealth bridge,” a program in which the firm has been investing in and about which it will make announcements in coming months and years.

“We’re going to take [our expertise] and plug it into plans, and that is going to have the most success in driving that customized experience into the individual,” he says.

Meanwhile, Anderson’s team is focused on making plan advisement easy and accessible to the firm’s vast network of advisers, while also ensuring that guardrails and guidance are in place to avoid any conflicts of interest between plan and wealth advisement.

To this end, the firm is “expanding” areas such as its 3(38) program, its third-party administrator capabilities and its relationships with recordkeepers, he says.

Finally, and perhaps more importantly, Cetera will keep leaning into its scale.

“We have an entire channel of individual advisers that have relationships with business owners and are their primary financial contact for every decision in their life,” says Anderson. “What better position can you be in to provide both sides of the table, to engage in a retirement plan and provide holistic financial solutions wealth management experience to those individual participants?”