Yield of Dreams

Q&A: LPL Aims to Lure Breakaways With Focus on Retirement Plan Business

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George Fraser, head of The Fraser Group at MSSB, brought his team over to LPL recently.

Since its acquisition of

National Retirement Partners in July 2010, LPL Financial has onboarded over 50 new retirement plan advisors, the latest being George P. Fraser, Frederic W. Amberg and Troy W. Haugen, a $300 million team that joined from Morgan Stanley Smith Barney this week. Bill Chetney, executive vice president of LPL Financial Retirement Partners and former head of NRP, said the broker/dealer hopes the focus on retirement plans will lure FAs who specialize in this area. “I think we have a real opportunity to double the business over the next three years,” Chetney says. Fraser, now managing director with Retirement Benefits Group, one of LPL’s retirement plan branch offices, spoke to Registered Rep. about his team’s move.

Registered Rep.: What made you and your team at MSSB make the move over to LPL?

George P. Fraser: I spent a long time doing due diligence and looked at a lot of different opportunities. I wanted to be in a conflict-free environment. I wanted to be with a leading organization that could support a broad range of business models. But I specialize in retirement and defined contribution. That’s what I’ve done for close to 19 years. And I felt like LPL had one of the strongest since their purchase of National Retirement Partners. That was really key to me: to be at a place that had a very strong specialization. I’ve been at several wirehouses, and I found that I was paying for services that I really wasn’t using. Now, that additional compensation can be used so that I can service my customers better. I have a team process in place where we provide very high-level education on an individual basis to employees, which makes a difference. It gets us away from the 1-800, the Internet access, the beautiful glossy brochures. It allows us to get in and sit one-on-one with people. And that was really key to our change. We wanted somebody to appreciate that.

RR: Was there a specific service that you felt LPL could offer that would be beneficial to your business?

GF: I wanted a feeling of team. I wanted camaraderie. One of the ways I did due diligence: I talked to wholesalers—DCIO wholesalers, 401(k) wholesalers—on a national basis, and talked to them about where we would fit best. I didn’t want to go someplace where we were going and just taking; I wanted to be able to give. Because of our education model, and after meeting the folks at Retirement Benefits Group, we understood clearly that they were interested in learning from us. We have been able to change metrics and plans for many years and be able to provide to employees this, not just about how they have a significant account, but really about how we can share with them how they’re going to cover expenses on a monthly basis. So I bring it down to a very granular level. Someone sits with us and say they can’t afford one more penny from their take-home, when we talk to them about subtle lifestyle changes today. That’s really the focus that we have.

RR: What are your thoughts on the growth in the retirement plan market and how advisors can serve those types of clients?

GF: Clearly, you have to specialize, and that means that you have to find ways to bring value. And it’s a competitive marketplace. This isn’t just about better performance in terms of the investments, because that’s the click of a button. How do you bring value in terms of changing participant behavior? Because at the end of day, this business is about getting people to put more away, helping them do it through subtle lifestyle changes.

In the old days, the business used to be about you take 401(k) as a loss-leader in order to get access to the C-suite executives to do their wealth management planning. We’ve never worked that way. Our business has been on focusing on the plan itself, on the design. We want to make sure whether you’re sweeping floors or washing windows or dishes that you have the capacity to have the same kind of education that you do if you’re the CFO or the CEO of the company.

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Casting a gimlet-eye on the independent broker/dealer channel and asset management issues.

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