Like Dr. Barbay said in the Rodney Dangerfield classic, there are two types of people in business: “the quick and the dead.” Maybe Dr. Bombay was in the retirement plan business at one time, because there are providers who are quick and those who are dead.
As a former third party administrator (TPA) employee and an ERISA attorney for over 18 years, I can attest to the fact that there are some plan provider who get it and some who don’t. The problem is that those who don’t end up leaving the business after a major change. Fee disclosure regulation changed the industry, many providers thrived and many didn’t. The providers, who were ahead of the curve and quick to change, thrived. Those who weren’t ready for the change and lived in a hidden fee environment and couldn’t shake that didn’t do so well or quickly exited the business.
That will be no different for the new fiduciary rule, there will be some providers who planned well and there will be some providers who’ll act like chickens without ahead and will be in panic mode and perhaps shelve business that they don’t need to, but will.
The point is that the retirement plan business changes so quickly and as a plan provider, you can’t just sit around and do nothing. You need to make quick decisions and be quick on your feet, rather than just sit around and wait for the world to change around you.
