Month: September 2020

Compensation Grid Changes

September 29, 2020

In 2018, ESI announced its first Schedule A Grid change in 20 years.  Rather than making one big change then, we broke the change into two phases, with the first implemented January 1, 2019 based on 2018 GDC, and the second scheduled to be implemented January 1, 2021 based on 2020 GDC.

In that first change, we moved from 5 tiers to 8.  Our objective was two-fold:

  1. To put in place long overdue increases to the top tier payout requirements
  2. To make it easier for reps to move up the grids by creating more tiers

As we begin to prepare for the second phase, we want to share some important information about the changes.  First, of course, is to provide you with the actual tier requirement changes.  These can be found below.  Please keep in mind that this change applies only to your commission based GDC business. The fee based advisory grids and payouts remain unchanged.

We also wanted to let you know that we recognize 2020 has been nothing like any of us imagined.  Markets became highly volatile as COVID-19 spread and then rebounded faster than many expected.  It’s uncertain what the remainder of the year holds in store for us.  Understanding that some of you are having record years, while others are seeing a slowing of business, we want to provide some level of flexibility as we look to make these changes.  With this in mind, as we look to set payouts for January 1, 2021, we wanted to let you know that we will use the better of your 2019 or 2020 GDC.

Please consult with your Branch Office Supervisor regarding your current payouts associated with each tier.

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Changes to VA Contracts Delivery – New FAQs Included

September 29, 2020

Historically, when a variable annuity was sold, the practice was to send the contract directly to the Rep who then delivered it to the owner. In this environment of touchless delivery and digital meetings, ESI has decided to update this policy so that annuity contracts are sent directly to the owner from the product vendor – either through e-delivery or direct mail / carrier.

ESI has requested that this change apply to all approved variable and fixed indexed annuities. This change is effective on October 1, 2020.  

If you have any questions, please contact ESI Operations at 800-344-7437.

Frequently Asked Questions

  • Depending on the carrier, the agent may receive an email notification that the policy has been issued and is pending mail.  Other carriers ask the agent to track the contract’s issue and delivery status in the agent portal. 
  • The use of delivery receipt varies by carrier – some use them, while other use the 3rd party delivering the contract as the receipt.  If the contract is delivered by 3rd party, (UPS / FedEx) the carrier will use that as the delivery receipt.  In all examples, agents are encouraged to confirm delivery.  That has not changed.
  • If an ESI rep is associated with a National Life cases, the delivery system should default to direct delivery.  National Life is in the process of converting to 100% direct delivery.

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Software Update from MoneyGuide Pro

September 29, 2020

Effective 10/12/20, two-factor authentication will be enabled within your MoneyGuide license and Client Portal.

Envestnet | MoneyGuide utilizes two-factor authentication as a security measure for accessing Plan data. Once enabled, when you log in, you will be asked to authenticate using two-factor authentication.

Prospects and clients with new Client Portal access (i.e. granted after two-factor has been enabled), will be prompted to set-up two-factor authentication prior to accessing MoneyGuide features.

Existing plan results will NOT be impacted.

For a step-by-step guide, click here.

Questions?
Contact MoneyGuide Support at 1-800-743-7092 or support@moneyguide.com.

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Will you be a winner in our eDelivery raffle?

September 22, 2020

To increase our e-delivery client subscribers, ESI is sponsoring a raffle for both registered representatives and non-registered fingerprinted (NRF) persons! Click here for raffle details and start promoting eDelivery so that you can participate!

Registered Representative Leaderboard as of 9/17/20 (note that a minimum of 20 e-delivery subscriptions per entrant must be received to be eligible to win):

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Non-Registered Participants Leaderboard as of 9/17/20 (note that a minimum of 20 e-delivery subscriptions per entrant must be received to be eligible to win):

A screenshot of a cell phone Description automatically generated

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AssetMark New Account Process Now Includes eSignature!

September 22, 2020

We heard your feedback and have been working with our partners at Assetmark to improve the new account process to include eSignature acceptance.

This process will look a bit different than other vendors you may work with. To complete eSignature with AssetMark you will have to follow the process outlined below:

  • Create a Proposal through the Assetmark website
  • Create an ESI paperwork bundle via Starting Point like any other piece of business
  • When using eSignature, a new Assetmark eSignature Acknowledgement Form is required and will be included in the Starting Point bundle
  • Upload the Assetmark proposal into the Docupace work item
  • Send the forms for eSignature to your client via the normal DocuSign process
  • Upon approval from ESI Home Office you can create the custodial account paperwork on the Assetmark website and send it to your client for eSignature through AssetMark’s process

NOTE: ESI does not require copies of the Custodial paperwork to be submitted in the work item and they should not be signed by the client until after ESI Home Office approval of the proposal.

While this new process does require two signing ceremonies by the client, we are excited to take this once manual process and create a time saving electronic experience.

For additional information on Starting Point or the eSignature process through DocuSign, please reach out to DocupaceSupport@nationallife.com  or 800-344-7437. For questions on the Assetmark Proposal or eSign process, please contact your relationship manager at eservice@assetmark.com or 800-664-5345, option 1.

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A Research Note from Envestnet PMC – Watch List Addition

September 22, 2020
Summary
Symmetry Partners (“Symmetry”) recently announced that Dana D’Auria, CFA, Managing Director, Portfolio Manager, will be leaving Symmetry at the end of September. D’Auria oversees the firm’s research department, is a member of the Investment Committee, and acts as portfolio manager for the Symmetry Panoramic Mutual Funds. She has been with the firm for fifteen years and has played an important role in the development of its current strategies. As a result of her departure, the Symmetry Structured Panoramic Portfolios, Symmetry Structured Portfolios, and Symmetry PrecisionCore ETF Portfolios will all be assigned the portfolio attribute of “Watch”.

Rationale
Ms. D’Auria had an important and highly visible role within Symmetry’s firm and her knowledge and experience will be difficult to replace. As a factor-based manager, investment research is the backbone of Symmetry’s philosophy and process. Overseeing the research team, she was responsible for the vetting of the various factors and investment principles used within Symmetry’s investment strategies. Under her tenure Symmetry’s research team has been a strength of the organization. Its thoroughness and knowledge of factor investing helped Symmetry stand out from many of it’s peers.

Ms. D’Auria’s role will be filled by Phillip McDonald, CFA, CAIA, CIPM. Currently McDonald acts as Portfolio Manager and Director of Investments. He has been with the firm since 2010 and has worked closely with D’Auria in the development of Symmetry’s current strategies and processes. His knowledge and experience in factor based investing as well as familiarity with Symmetry should help minimize any disruptions over the short term. Over the long-term, his role will be to build on the work of his predecessor to deepen the research focus of the firm and to enhance its investment strategies.

Symmetry has always emphasized process over people. As a result, they have built a strong team with an emphasis on shared responsibilities. Day to day, the firm’s strategies should continue to run without interruption as its research team and investment committee remain strong in numbers and experience. Envestnet|PMC has confidence in the remaining team and the firm’s strategy for replacing D’Auria but will continue to monitor the situation to ensure that the firm’s team and processes remain at their current high level..

Greg Richards, CFA, CFP
Senior Investment Analyst

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401k Retirement Plan Options from American Funds and TD Ameritrade Now Available

September 22, 2020

Overview
Two new 401k retirement plan options are now available to Investment Advisor Representatives. Capital Group, home of American Funds, offers flexible retirement plan solutions, available for your 401k clients. These solutions include multiple share classes, including two that are structured for fee-based advisor compensation.  The TD Ameritrade Retirement Plan brings together ease of plan administration, investment flexibility and support in meeting the plan sponsor’s fiduciary responsibilities – all in a turnkey approach. 

TD Ameritrade Details
The TD Ameritrade Retirement Plan offers open investment architecture with institutional fund pricing and includes resources, tools and education for plan participants.  ESI requires that each plan have a 3/38 ERISA Investment Manager.  The TD platform will generally be a competitive solution for larger plans, (i.e. $2M+). 
Platform features include:

  • Open architecture of fund lineups offering the lowest-priced share classes
  • Record keeping/administration and custody of the plan assets
  • Advisors may set their own fee (must be within ESI maximums based on plan AUM)
  • 401k plans must select an ERISA 3(38) services independent third party.  This service provides additional liability protection for the plan sponsor.


American Funds Details
Offering the advantages of large-plan pricing to small- and mid-size employer-sponsored retirement plans, American Funds RecordkeeperDirect and Plan Premier are available in fee-based solutions. While American Funds 401k commission-based products have been available in the past, the expansion of additional share classes provides ESI advisors with a flexible fee-based solution.
Platform features include:

  • Increased pricing transparency with R5 and R6 share classes, the lowest fund expense share classes for American Funds 401k plans
  • Record keeping/administration of plan
  • Fixed dollar approach to plan pricing that – depending on share class – generates a plan credit that can offset plan expenses. Over time, net plan expenses, as a percentage of assets, will decrease as assets grow.
  • Advisors may set their own fee (must be within ESI maximums based on plan AUM)
  • 401k plans using either the R5 or R6 share classes must select either ERISA 3(21) or ERISA 3(38) services independent third party, Wilshire Associates Inc. (Wilshire®). This service provides additional liability protection for the plan sponsor.

Opportunity
For advisors already working in or considering expanding into this market, the American Funds and TD Ameritrade names and support can help you establish yourself and grow. Both offer a strong service model and ERISA-level technical support for advisors working in the defined contribution plan arena.

Learn More
American Funds:

  • Click here for an overview brochure.
  • Contact American Funds at 800-421-9900.

TD Ameritrade:

  • Contact TD Ameritrade at 303-294-5328.

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Important Read: Changes to VA Contracts Delivery

September 22, 2020

Historically, when a variable annuity was sold, the practice was to send the contract directly to the Rep who then delivered it to the owner. In this environment of touchless delivery and digital meetings, ESI has decided to update this policy so that annuity contracts are sent directly to the owner from the product vendor – either through e-delivery or direct mail / carrier.

ESI has requested that this change apply to all approved variable and fixed indexed annuities. This change is effective on October 1, 2020.   

If you have any questions, please contact ESI Operations at 800-344-7437.

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