Evolve with 401(k)s, says expert

Advisers who are willing to embrace the changes in the 401(k) space will have the “best of times” said Fred Reish, an expert in employee benefits law. Mr. Reish, managing director of Reish Luftman Reicher & Cohen, a Los Angeles law firm, spoke today at the Center for Due Diligence conference in Scottsdale, Ariz. Likewise, Mr. Reish predicted “the worst of times” for any adviser who refuses to adapt to new changes in the 401(k) space, which include more automatic features, customization of plans and more technical expertise. “We can have a lot of fun with this if we look at this change positively,” he said. As the 401(k) plans continue to get more complex, employers expect more knowledge from advisers. Mr. Reish urged advisers to start working more closely to help their plan sponsor clients start thinking about adequacy of deferral rates from plan participants. He said that many participants are deferring far less than 10% of their compensation to their 401(k) plans and that’s something that advisers can help improve.