You might be a golden Plan provider, but some Plan sponsor may see you as trash

by Ary Rosenbaum

Aside from my children and my wife, my favorite person of all-time was my grandmother Rose. In a few weeks, it would have been her 90th birthday and I wish she could have made it because she was the most selfless person I ever met, who was full of life, and love for family. When my grandmother decided she would move upstate to live with my aunt, she started cleaning out her apartment. She put her trash on the side of the street for sanitation pickup and she was amazed that people on the block were looking through her trash. She said: “what do they think I threw out, gold?”

It was a funny line, but I think my grandmother didn’t understand that to some, her trash might be gold.

As a professional plan provider, we usually think we’re great and we’re stumped when a potential client cherishes an incumbent plan provider that we know is no good and we’re dumbfounded by it. It’s human nature to question what a plan sponsor could see in such ap plan provider, but we see this all the time whether it’s business or in family. What we may think is trash is someone’s gold and what we think is gold is someone else’s trash.

I worked for a third party administrator, where the chief operating officer would champion some administrator or actuary or salesperson as a superstar. They never were a superstar, but since this fellow cared less about good administration and more about paying employees on the cheap, they were his superstars.  He would tell me how he got an actuary for a $75,000 salary; the fellow wasn’t $7,500 even more so after the other partner woke up the actuary while he was sleeping at work.

I remember when a relative of mine dated someone she unfortunately married. I would hear my mother tout that he was a businessman. Dropping out of a community college, operating a hot dog stand at a flea market, and owning a dry cleaning store that did none of its dry cleaning doesn’t make a businessman. 24 years and 3 careers later, the jury is still out. But some people have such wacky (we think of low) expectations of their plan providers, that no matter how great you are and how bad the incumbent is, it’s not going to change.

It’s like the Olive Garden. Having grown up in such an Italian-Jewish neighborhood such as Canarsie, Brooklyn who all moved where I live in Oceanside, Long Island, I hate the Olive Garden. When you grow up with great Italian food, you find Olive Garden an affront because it tries to be the McDonalds of Italian food. Some people out in the Midwest where there are not many Italians may think the Olive Garden is the greatest thing ever. I’m not going to debate someone who loves the Olive Garden because you can’t properly debate opinions.

The lesson here is that there are some times; you’re not the answer because the plan sponsor loves the plan provider. Maybe the plan provider is a relative; maybe the plan provider went to the same college as the owner of the company; maybe the plan sponsor likes to surround himself or herself with incompetent people to make himself or herself competent (that TPA COO did that).  Whatever the reason, it’s a waste of time to crack that nut.  Just remember you’re not crazy, but maybe the plan sponsor is.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Ary Rosenbaum, The Rosenbaum Law Firm P.C. | Attorney Advertising

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Ary Rosenbaum

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