Fi360 upgrades adviser fee-benchmarking tool

Retirement plan advisers and firms can use software filters to see how their fees compare to industry peers

Dec 11, 2017 @ 11:00 am

By Ryan W. Neal

Fi360, which provides education and technology to help advisers comply with fiduciary rules, is upgrading a tool that retirement plan advisers can use to prove they charge clients a "reasonable" fee.

The Fee Benchmarker product draws on a proprietary database to show a firm or individual adviser how the fees they charge compare to peers. Fi360's tool lets advisers refine the comparison group by plan size and services offered, then generates a sponsor-ready report of the data.

Fi360's update, which will go live later this week, gives advisers the ability to customize reports and is now integrated with Fi360's Fiduciary Focus Toolkit, a suite of automated workflows and adviser oversight technology.

It offers three main service filters: Act as Discretionary Fiduciary 3(38) to the Plan, Financial Wellness Program Strategy, and Model Portfolios. Users can view a total of 27 services to see if they are commonly delivered to a similar plan size, according to John Faustino, Fi360's chief product and strategy officer.

The firm said Fee Benchmarker is available to institutions and individual advisers either as a standalone product or bundled with Fi360's other technology.

(More: Fintechs producing cheaper, automated firm valuations for advisers.)

Mr. Faustino said in a statement that the benchmarking tool helps firms implement fiduciary practices while remaining profitable.

Fee Benchmarker was originally developed in 2009 using retirement plan research from Ann Schleck & Co., a consulting firm Fi360 acquired in 2013.

While the Department of Labor's fiduciary rule mandates that adviser compensation is "reasonable," it does not specify how it should be determined or calculated. Mr. Faustino said using a comparison tool like Fee Benchmarker follows "sound fiduciary and business development processes."

Orion Advisor Services launched a similar tool in 2016 that compares fees not just across retirement plan accounts, but across all managed accounts. Another vendor, Fiduciary Benchmarks, launched a fee-benchmarking tool in 2015 and an IRA solution in 2016.


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