How do financial professionals defeat a lumbering foethat lacks the depth to move with agility in the ever-changingenvironment that is the 401(k) universe? “Float like a butterfly,sting like a bee.” (Photo: Shutterstock)

Until such time as an unambiguously open 401(k) MEP becomes the corporate retirementplan standard, plan sponsors will continue to need to educatethemselves on the art and maintenance of their firm’s 401(k) plan.There are plenty of tried and true methods they use to exploreself-education (see “This is How 401k Plan Sponsors Get EducationAnswers to These Three F-Words,” FiduciaryNews.com, July 30,2019).

If you disassemble the route plan sponsors take towards education, you’ll discover a significantsimilarity. As you might expect, many of them rely on their serviceproviders to offer the needed teaching materials – both for theirown edification as well as for the needs of their employees.

But that’s not the only place where they find what they’relooking for. And this alternative source has been the bane of manya financial professional. Its lessons come through unfiltered andunverified. You’ll find it regularly contains both alluring mythsand outright lies. The lectures often echo out in memorablesoundbites. Each message chisels another chip off the credibilityof the financial professional.

Oh, and did I mention the source of this information chargesnothing for the service?

How do you compete against free? How do you dissuade theaudience that the 401(k) equivalent of “The Daily Show” is not thesame as the real news? In a sense, just as legitimate news sourcestoo long ignored “The Daily Show” and allowed it to garner a falselegitimacy, so too have financial professionals ignored thiscompetitor.

What I’m referring to is the cornucopia of content farms thatproduce unvetted advice. These sources grow like untended weedsacross the media stream, from websites to podcasts to cablechannels. Not all information distributed through these media isillegitimate, but much of it is meant solely to sell ads, notimpart meaningful knowledge.

Unfortunately, just as “The Daily Show” is written to be muchmore digestible than the typical network news show, smart creatorshave exploited their mass media (and marketing) acumen to divertthe attention of both 401(k) plan sponsors and participants.

Now, this isn’t a new problem. Professionals from all sorts offields have faced this forever. Doctors have had to contend withsnake oil salesmen. Preachers have had to confront false prophets.Scientists have had to vie with mystics.

So, too, then, have financial professionals had to deal withthose who haven’t earned their way into the craft, but who haveinstead practiced the art of modern oratory. These are the sourcesof the sexy sizzle that turns people away from the nourishingsteak. And all under the guise of “no charge.”

Again, how do you compete against free?

There is, however, a winning strategy. It comes not without somemodest investment. It comes not without some need forassertiveness. But it does come with a proven formula forsuccess.

There’s not enough space in this column to detail the completeanswer, but perhaps a metaphor might help you imagine the path tovictory.

Muhammad Ali famously said “Float like a butterfly, sting like abee.” He used his deft footwork to dance, pivot, and jump aroundhis lumbering but stronger rivals. They could not move fast enoughto score against his quickly changing target. As Ali floated, hisopponents tired themselves out. Meanwhile, Ali’s stinging jabsfurther weakened his challengers. Ali didn’t always win, but he wonenough to be nicknamed “The Champ.”

How do financial professionals defeat a lumbering foe that lacksthe depth to move with agility in the ever-changing environmentthat is the 401(k) universe? “Float like a butterfly, sting like abee.”

Where do 401(k) plan sponsors go to learn? They can go anywhere,but the smart ones know the only true source is an experiencedprofessional.

READ MORE:

A 3-word fiduciary rule — Carosa

The ‘Fiduciary Rule’ versus the ‘Rule of Fiduciary’— Carosa

Do you have the ‘knows’ to be a fiduciary? —Carosa