2. Comparing Fees and Services – Daily Valuation DC Plans
Joseph B. Boyle, MSPA
Sales Consultant – Mid-Atlantic Region

3. Agenda Current Fee Environment Plan Participants’ Concerns
What Do Plan Sponsors Want From a Service Provider?
What Do Advisors Want From a Service Provider?
Types of Plans BPAS can handle on our Daily Platform
Pricing Example
Questions

4. Current Fee Environment
408(b)(2) requirements – became effective 7/1/2012
On 3/12/2014, DOL released Version 2…becomes effective 12 months after finalized
Plan Fiduciaries must be provided
Description of all services provided
Disclose indirect (12b-1 and sub-ta fees) and direct compensation
Must be updated annually or when fee changes occur
Fee Transparency and Simplicity
Some vendors more clear than others
Marketplace and regulators will punish confusion
“Guide Requirement”

5. Current Fee Environment
“Guide Requirement”
Purpose is to improve understanding
Enable Fiduciary to “quickly and easily find” all information required
Fee fairness across all assets
ERISA Recapture Accounts
They are legal but BPAS considers them unfair
Recent fee litigation underscores this point (ABB legal case)
Benchmarking across all service providers
Financial Advisor
Recordkeeper, TPA and Custodian
Investment Management

6. What Americans Worry About Most
Age Group
Not Enough Money for Retirement 52% 68% 72% 42%
Not paying serious illness 52% 63% % 50%
medical bills
Not maintaining standard of living 46% 51% 61% 42%
Not paying regular medical bills 39% 48% 51% 35%
Not paying normal monthly bills 40% 42% 44% 31%
Not paying children’s college % 59% 29% 7%
Not paying rent or mortgage % 39% 39% 19%
Not paying credit card bills % 21% 22% 14%
Source – Gallop Economy and Personal Finance Survey (April, 2013)

7. Services Plan Sponsors Want
Total Retirement Outsourcing
HR Outsourcing
3(16)
Fiduciary Services
3(38)
Plan Design Consulting and Administration
Competitive Fees
CFO and DOL

8. Services Plan Sponsors Want
Single Point of Contact for all Administrative Services
All transactional processing handled by a third party
Loans, Hardships, Payouts
180 / 360 payroll integration with recordkeeper
Better designs to bring better results for the participant
HR and the CFO have different priorities…both must be accommodated

9. Services Advisors Want
Satisfy all the Plan Sponsor requirements
Plan Analytics to help advisors evaluate success metrics
GAP Analysis Reports
Investment Reports linked to IPS
Resources
Education and Communication
Web Tools
Knowledgeable experts
Strong Design Capability

10. Services and Features Resonating and Gaining Steam
Automatic Enrollment and Escalation
Reduces demand for on site education meetings
Increases participation and savings rates
Improves ADP testing Results
Frees up advisor to provide holistic financial planning
Support to reduce leakage
Retention of assets related to terminated participants
EGTRRA IRAs
Reduces notice requirements
On DB side, lowers PBGC premiums
May lower counts so no audit is required

11. Plans Types on our Daily Platform
All 401(k)s …benefit driven or tax oriented
403(b)s including multiple vendor arrangements
Multiple Employer Plans (Open, Closed and METs)
KSOPS and ESOPS
Taft-Hartley Plans and Prevailing Wage Plans
457(b), 457(f) and 409(a) Plans
LOSAPs (Length of Service Award Programs)
1081 Puerto Rico Plans
IRAs
Defined Benefit and Cash Balance Plans

12. Pricing Example & Comparison between Incumbent vendor and BPAS
BPAS won Plan 10/1/2013, converted 1/1/14; Plan Assets of $10.7 million and 375 participants
Incumbent (Insurance Company
and TPA Service Model)
Annual Base Fee $ 5,785 or %
Account Fee
Admin Asset Fee $63,130 or 0 .59%
Advisor Fee $26,750 or 0.25%
Cost of Funds* $41,730 or 0.39%
All-in cost $137,395 or 1.28%
BPAS (Serving as Custodian, Recordkeeper
and TPA)
Annual Base Fee Waived
Account Fee ($36) $13,500 or .12%
Admin Asset Fee $21,400 or .20%
Advisor Fee $32,100 or .30%
Cost of Funds* $29,456 or .28%
All-in cost $96,456 or .90%
Note: Revenue from Insurance Company Stable Value not included.
Benchmarked Fees: (k) Averages Book (All-in Cost)
$10,000,000 in assets and 1,000 accounts – 1.39% on assets
$10,000,000 in assets and accounts – 1.14% on assets
$10,000,000 in assets and accounts – 1.20% on assets (estimated)

13. How to Rate a Service Provider
Is the total number of plans they service important?
Breadth of plan type capacity?
How important is brand name?
If free education meetings are built in all pricing anywhere/anytime…is that a concern?

14. How to Rate a Service Provider
How important is:
Robust plan design and administrative capabilities so plans are setup to support client objectives without service capability limitations?
Competitive pricing and complete fee transparency?
Commitment to independent advisor service model?
Knowledgeable and up-to-date workforce on qualified plan rules?
3(16), 3(38), capability with a mindset to go “Green?”
Ability to create CIFs as a way of handling model portfolios more efficiently?
Commitment to benchmarking and delivering services that generate value-added services for Plan Sponsors?

15. Questions?

16. Contact
Joe Boyle
BPAS
Sales Consultant