Business at a Glance as of 12/31/22

• Plan assets under advisement: $3 billion
• Median plan size (in assets): $4.5 million
• Plans under administration: 254
• Total participants served: 51,432

PLANADVISER: Tell us about your practice and how you got into advising retirement plans.

Shepherd Financial: Shepherd Financial was established in 2015 through a merger of the two retirement plan practices of our three founding partners: Steve Wylam (CFP, AIF, CPFA), Tom Mayer (AIF, CBFA) and Drew Denny (CFP, C(k)P). In 1987, Steve began in the financial industry with the desire to serve as a personal CFO for his clients. He began advising retirement plans in 1996. While working as a limited term professor at Purdue University, he met Tom; in 2004, they formed the 401(k) Team @ CAMI. Drew joined his family’s insurance practice and began advising retirement plans in 2001.

Since 2015, Shepherd Financial’s retirement plan practice has been led by Leah Sylvester (QKA, QPA, CPC). As our ERISA compliance specialist, her leadership, communication and 16 years of consulting experience in retirement plan design and administration allow her to greatly ease the day-to-day fiduciary responsibilities for plan sponsors.

Holly Willman, the director of creative and strategic operations, provides vision and leadership, enhancing our company’s structure and long-term organizational success. She develops and executes creative programming, communication and financial wellness resources for plan sponsors and participants. Having worked with Tom and Steve for the past decade, Holly has been integral in forming, enhancing and advancing the processes that guide our business.

David Bauer (AIF), director of investment management, has more than 25 years of experience in the financial services industry. Utilizing a comprehensive approach, he monitors and performs due diligence for all investments, produces quarterly monitoring reports and provides detailed fund notes to assist committee members in decisionmaking and documentation.

Our team has now grown to 32 team members, including nine practicing partners, through a series of strategic hires, mergers and acquisitions. Our team structure and environment set us apart in the retirement industry. While we are proud of the work we do, it is clearly fueled by the team we have built. We genuinely care for one another, and that care ultimately extends to every client we serve. Though each client has a dedicated service team at Shepherd Financial, one of our unique features is having specialists in every role with the ability to fully support other team members, plan sponsors and employees.

The core values that shape our team and work are:

• Integrity: We thoughtfully serve our clients and one another with trusted, dedicated and highly responsive
• Service: We regularly and generously share our time, expertise and money to positively impact the well-being of our clients, community and one
• Empathy: We genuinely value people, honor their unique experiences and capabilities, and create inclusive, collaborative
• Innovation: We are engaged and passionately curious, generating creative and flexible solutions for our clients and
• Quality: We provide consistent service and resources, offering unmatched value and accountability to our clients and the financial
• Growth: We intentionally seek opportunities to learn, develop and flourish, emphasizing individual and team health.

PLANADVISER: How is your team/process/structure unique? How has it evolved? Where will you be in five years?

Shepherd Financial: Our practice has transitioned from individual advisers to a true team environment. Our team depth, training and extensive experience enable us to produce customized, quality content for each client, plan sponsor and employee. From the onset of the client relationship, detailed workflows are utilized to generate tasks and timely deadlines to streamline all aspects of client service, including onboarding, service provider conversions, employee and committee meetings, and relevant follow-up. We use robust, state-of-the-art technology and resources to empower clients in every aspect of their plan management. Our consistent, documented process combines consulting, independent investment management and continuous oversight. We believe these elements help plan sponsors and committees effectively and responsibly guide their retirement plans and, ultimately, contribute to employee well-being.

We constantly seek proactive ways to add significant value for both employers and employees. As consultants, our job is to listen first—we want to understand pain points and provide actionable solutions. We know each plan is unique, so there is no one-size-fits-all solution—we listen, plan and modify as needed. We are proud to be consistently engaged in ongoing dialogue with our clients’ committees. We adhere to a fiduciary standard and operate in a fiduciary capacity with each of them. We then act as an extension of their benefits teams. Our retirement plan consulting services and fiduciary support include, but are not limited to:

• Fiduciary guidance and training for plan trustees and committee members
• Plan administration, compliance and design consulting
• Form 5500 review
• Compliance testing review
• DOL and IRS audit assistance
• Corrective actions
• Bonding and insurance
• Compliance and regulatory review of plan documents
• Service provider benchmarking and fee review
• Service provider relationship accountability and issue resolution
• Investment monitoring reports and performance analytics
• Investment policy statement preparation and review
• QDIA suitability analysis
• Cybersecurity due diligence
• Merger, acquisition, spin-off, and termination consulting
• Customized enrollment video
• Enrollment meetings
• Financial wellness program
• Financial wellness webinars
• One-on-one meetings with employees
• Retirement readiness analysis for employees

As we have grown, our process and benefits for plan sponsors have also expanded. Throughout the course of a year, we cover the above services during regularly scheduled committee meetings. We are the leaders in this process, preparing a detailed agenda to show everything that should be discussed to show plan sponsors’ due diligence for the plan, then documenting all decisions. Our team is responsible for doing the heavy lifting—following the meeting, we provide minutes for fiduciary review and further documentation, implement investment and or plan design changes, schedule employee meetings and ensure proper and timely follow-up for any outstanding items. We truly believe in relieving the burden from plan sponsors wherever possible.

In recent years, for instance, we observed clients being selected more frequently for DOL audits. To help our plan sponsors be better prepared, we created a detailed checklist to align with a DOL audit document request. This checklist, applicable signed plan documents, committee meeting minutes, participant notices, fiduciary documentation and service provider agreements are uploaded to each client’s secure online fiduciary vault.

The DOL has also begun to ask for documentation showing committee members have completed fiduciary training. In an effort to address this, we made an investment in an online fiduciary training program. Within our online portal, committee members can complete either the basic or advanced course to better understand their fiduciary responsibilities at a convenient time.

Following completion of the training, committee members receive a certificate of completion, which is then stored in their vault.

When the DOL published its cybersecurity best practices, our team took immediate action. It was important to help plan sponsors understand the maintenance of cybersecurity would now be considered a fiduciary responsibility; we encouraged plan sponsors to connect with their IT departments to ensure continuity between their standards and those of external providers. Our team created a request for information from service providers with whom we work to help facilitate and document the due diligence plan sponsors need to meet these best practices. We asked each service provider to complete an exhaustive cybersecurity request for information and annually gather and review the most recent SOC 1 and SOC 2 reports for each in order to better advise our clients about service provider operations.

Beyond our day-to-day support for plan sponsors, we are also passionate about offering resources and information outside of their normal scope of access. Semiannually, we host an event called Coffee and Continuing Ed, inviting subject matter experts to provide valuable insights, current regulatory and industry updates, and continuing education credits to plan sponsors and other team members they would like to invite.

In the next five years, we hope to double our team size through both organic growth and acquisitions. This will allow us to expand our national footprint to deliver our service model to a wider scope of people. We believe the Shepherd Financial team can help other advisers and firms scale as well, providing opportunities to train younger advisers in this unique space. Our team wants to make an investment in the future, committing to our growth and that of the next generation.

We have also received requests from plan sponsors for an easily accessible financial wellness resource for their participants. For the past 18 months, our team has been carefully vetting service providers. We want to offer a tool—including a mobile application—that gives participants account aggregation, calculators, clear resources and goal-setting capabilities. Our goal is to launch this platform to participants through a series of multimedia initiatives, then provide specific usage analysis to plan sponsors.

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

Shepherd Financial: At our core, we take the most pride in helping people—our heart is to give back. We are a trusted resource for plan sponsors, answering questions and helping them meet their fiduciary responsibilities. For example, when a human resources employee leaves a company, there can be distress or confusion from remaining team members about how to move forward and correctly administer the plan. Our team quickly steps in to help alleviate concerns. Once a new employee is hired, we proactively reach out to discuss their role, the rules of the plan and how to seamlessly immerse themselves in the role. We strongly believe in leaving no one behind. In every conversation, we focus on the individual—no matter their income or title—to ensure they are set up for long-term financial success.

PLANADVISER: How do you grow your business? What changes to your practice or service model are you planning for 2023 or 2024?

Shepherd Financial: Our growth comes both organically and through referrals. These referrals may be from team members, current clients, former committee members working at a new employer or our sister company, a benefits broker. But we also want to deepen each current client relationship, so our scope of consultancy has widened. This involves conversations, research and analysis about adding non-qualified or cash balance plans, as well as reviewing the breadth of insurance offerings for the company and its key employees.

An important new initiative we rolled out in 2023 is our QDIA suitability analysis. Our process begins with a target date analysis survey, completed by a plan’s committee members. The survey helps determine what the committee thinks about the objectives, costs and asset diversification of the plan’s target-date funds. Following the survey, a QDIA analysis presentation compares the current target-date funds with other options, reviewing asset allocation exposure, glidepaths, upside and downside capture, and performance. Risk allocation funds and managed account options are also presented for consideration.

With the passage of SECURE 2.0, proactive consulting is of the utmost importance to ensure plan sponsors understand all changes that may impact their plans, both mandatory and optional provisions. Our team regularly meets with leadership at recordkeepers to understand their methodology for how and when optional provisions, such as student loan matching programs and sidecar emergency savings accounts, may be implemented. The recent legislation has also provided new tax credits to incentivize small businesses. Since these credits looked back five years, we conducted a review of our book of business to discover and educate the eligible clients, ensuring they received all benefits possible.

Beginning in 2022 and remaining a priority project in 2023 and 2024, Shepherd Financial formed our own pooled employer plan (PEP). The PEP helps alleviate the administrative burden to small employers in a cost-efficient manner. While a PEP is certainly not for everyone, part of the fun we find in consulting is helping plan sponsors find their right solution.

PLANADVISER: What challenges do you think the retirement plan industry faces and what role do you have in addressing and confronting those challenges?

Shepherd Financial: The rules surrounding retirement plans are becoming more complex. For example, plan sponsors face a multitude of decisions to make about the optional provisions of SECURE 2.0. They want to know if the features will truly be a benefit to their people, as well as how to navigate its complexities.

Our team is committed to remaining subject matter experts because we want to stay ahead of the challenges and provide a roadmap for plan sponsors. We continue to invest in our own team members, providing additional learning opportunities and enhancing our technological capabilities. We are constantly on the search for ways to scale as an organization and practically implement the tools and resources at our disposal.

PLANADVISER: Why do you feel it is important to work with plan sponsors and companies offering retirement benefits to their people?

Shepherd Financial: While all of our core values are important, we know empathy is what truly sets us apart. What we do matters, and we differentiate ourselves with how we serve our clients. We understand plan sponsors are tasked with balancing an array of complex issues—they want to feel comfortable with their roles, responsibilities and fiduciary liability; navigate the political landscape; avoid lawsuits and audits; and make the best decisions possible for their employees. However, this is not their full-time job—it is ours. It is absolutely our responsibility to provide clear, consistent leadership and guidance for these fiduciary decisions. Put simply, we want to illuminate which decisions must be made and equip plan sponsors with the information required to make those decisions.

The need for retirement plan experts has never been greater—the employer-sponsored retirement plan will be the main, if not sole, source of income in retirement for many future retirees. We must emphasize the plan’s importance and features at every opportunity. Outside of the retirement plan, we want to add value to every facet of our relationships with clients. The entire benefits package can work together to help recruit, hire, and retain the key employees that will set them apart in their own industries. Our processes help plan sponsors remain competitive in the marketplace.

PLANADVISER: What are the most important issues that your plan sponsor clients face with their company retirement plans, and what particularly effective or unique actions do you take to assist them in overcoming those issues?

Shepherd Financial: We help plan sponsors better understand how to be proactive: this includes working ahead of legislative changes like SECURE 2.0, tackling topics like student loans, guaranteed income and ESG funds, utilizing a prudent process to defend against litigation and working with service providers to ensure timely and accurate corrections following any kind of error.

Advocacy for plan sponsors and participants is a constant priority for our team. Our efforts can be seen in positive metrics like lowering plan fees, increasing plan participation and increasing savings rates. Our team provides innovative approaches to awareness, communication, engagement, plan design and employee retirement readiness.

We believe this attitude of advocacy is essential because of the many underlying costs of participants choosing to delay their retirement. This delay is caused by financial unpreparedness, rising healthcare costs and a lack of understanding about how to allocate funds properly among their benefits options. Additionally, in the coming years, there will be a greater dependency on employer-sponsored retirement plans as Social Security benefits are decreased. However, employees struggle with more than saving for retirement and need quick, easy and efficient guidance for everyday life.

Plan sponsors may feel helpless assisting employees in meeting their retirement income goals, but one way Shepherd Financial works to overcome this challenge is with creative plan design. Assessing and monitoring the health of a retirement plan includes benchmarking its features against peer plans. While automatic enrollment and automatic increases have been part of our recommendations for years, there are further actions to challenge employers, such as increasing the automatic enrollment rate, as well as the automatic increase cap. We have introduced the concept of annual re-enrollment to capture employees who would otherwise fall by the wayside. Enhancing the matching contribution formula and vesting schedules can also bolster retirement savings.

We also support plan sponsors with actual boots on the ground. Our team is passionate about helping employees address everyday financial concerns and successfully prepare to retire on their terms. We believe a key factor in achieving these goals is increasing financial knowledge and wellness. Shepherd Financial provides employees with education and engagement opportunities throughout the year, giving both general education and specific investment advice.