2016 RPAY – Tom Reese

PLANADVISER: Tell us about your practice and how you and your team members got into advising retirement plans.
Tom Reese: Conrad Siegel Investment Advisors is a wholly owned subsidiary of Conrad Siegel Actuaries. We are an investment advisory firm providing independent investment advisory services to 401(k) and other defined contribution plans, defined benefit pension plans, municipal plans and high-net-worth individuals. The heart of our philosophy is centered on broad diversification as a way to reduce risk, and we use low-cost mutual funds.

Conrad Siegel Investment Advisors started providing services in 2002 as a result of client demand. Our parent company, Conrad Siegel Actuaries, has been providing employee benefit services for over 50 years. Our clients value our independence and began asking us to provide investment advisory services.

I personally got started in the employee benefits industry after working as an electrical engineer. I was always interested in investments and helping family and friends with retirement planning. I decided to pursue that passion and become an actuary after I realized how much others struggled to understand investments and retirement planning. I wanted to share my knowledge and help others prepare for their own retirement.

PA: What is your mission statement?
TR: To provide independent advice and comprehensive employee benefit services to clients to help them handle their most complex and unusual business challenges in the best interest of the company and its employees.

PA: How is your team/process/structure unique? How has it evolved?
TR: While other advisers specialize in investment consulting, I have both investment and retirement consulting expertise. My expertise for retirement consulting goes beyond automatic plan features. I focus on complex situations such as mergers and acquisitions, nonqualified arrangements and multiple employer 401(k) plans.

PA: What have you done in the past year to improve participants’ retirement readiness?
TR: The typical 401(k) plan expects a lot from the average participant in terms of making good choices that maximize the potential for a good retirement outcome. Along with my firm, I use ideas from actuarial and behavioral science to help participants realize the full value of their benefits. This includes improving plan design to give plan participants a greater chance to succeed and implementing education campaigns to discourage them from taking money out of the plan.

By updating the plan design, I make it simple and easy for participants to participate with auto features such as auto enrollment and auto escalation. Through my 20-plus years of experience, I have seen that participants are much more likely to take full advantage of the plan and perceive their benefits more positively when they are not overwhelmed. I also help put these participants in a better position for success by helping them be more appropriately invested and developing investment options that fit their goals.

PA: Describe any particularly noteworthy initiatives you have led with your customer base in the past 12 months (investment, education, plan design or communication).
TR: Many of my clients have expressed an increased interest in helping employees improve their retirement readiness. To that end, I have provided plan participants with increased education and communication around financial wellness. Through this education, I help participants better understand the proper balance between living comfortably today and preparing for the future with basic budgeting, types of savings, expense management, and debt management. This communication also provides the participants with a clear action plan for how they can be financially well.

In addition, I have implemented plan design changes to help employees be invested more appropriately as they approach retirement. Our firm’s Automatic Risk Reduction Program (ARRP) helps 401(k) plan participants ensure they’re taking the necessary steps to gradually become more conservative with their investment portfolios. ARRP combines simple, automatic changes from popular target retirement date funds with transparent risk-based portfolios. Participants select an appropriate risk-based portfolio that is automatically rebalanced on a quarterly basis. When opted into ARRP, participants are gradually stepped down to a more conservative portfolio as time goes on. Unlike other 401(k) products, the program allows risk-reduction schedules to be tailored, based on which risk-based portfolio they are currently in along with low fund expenses and transparency in how the portfolios are managed.

Employers have also expressed increased interest in helping employees draw down their savings once they reach retirement. To meet this need, we developed our Check Mate program to provide retirement plan participants with income during retirement. Retirees who opt in to Check Mate receive customized annual withdrawal amounts as long as they remain in the plan. Many of the current solutions in the marketplace are not best suited for all retirees. Check Mate is designed to be flexible and provide participants with the same low-cost investments they had access to before retirement.

PA: As a retirement plan adviser, what do you take the most pride in?
TR: I take pride in helping clients accomplish their business goals and helping individuals get to a better place for their own retirement. It is a great feeling knowing that Conrad Siegel Investment Advisors has helped provide outstanding benefits to employers that help them attract and retain great employees.

PA: What benchmarks do you use to measure plan and client success? How do you react to clients or prospects who don’t share your goals for their retirement plan?
TR: For benchmarking, I most commonly look at the number of people participating in the plan and their savings rates. I also look at the design of the plan to identify if it is set up to help employees succeed. Across the industry, we aim to get employees to save at least 12% to 15% of their pay, including the employer contribution. As an industry, we strive to help employers both meet their goals and put employees in a better position for retirement.

BUSINESS AT A GLANCE

LOCATION: Harrisburg, Pennsylvania
TOTAL PLAN ASSETS UNDER ADVISEMENT: $514.64 million
MEDIAN PLAN SIZE (IN ASSETS): $8.9 million
TOTAL PLANS UNDER ADMINISTRATION: 26