PASADENA, Calif. - After meeting with members during financialplanning sessions, one of Wescom Financial Services' advisorsconsistently noticed that many of them really didn't understand howtheir 401(k) plans worked. So the division, which is a wholly-ownedsubsidiary of $3.3 billion Wescom Credit Union, set out to puttogether a program that would not only advise members on the basicsof 401(k) participation but hone in other pressing retirementconcerns, said Keith Pipes, president of Wescom Financial Services.Rolled out in February, more than 225 members have participated inthe program, which is available at both Wescom and $667 millionKeyPoint Credit Union, which is a WFS credit union client as is$130 million Parsons Federal Credit Union. KeyPoint startedparticipating in late 2005. The way it works is members bring tothe free, "no-obligation" session their 401(k) statement thatincludes the full menus of investment options available, statementsfrom previous employers and traditional and rollover IRA accounts.An advisor will go over all the information to ensure that themember is taking advantage of any company match and if there's roomto increase their contributions. Pipes said while there is nodiscussion about recommending specific investments, advisors dotalk generally about diversification, asset allocation and timehorizons. "We wanted to send a message that it's important formembers to take control of their retirement," Pipes said. "We tryto make them aware that Social Security probably will not be ableto contribute to their retirement the way it has for previousgenerations." The sessions are anything but cookie-cutter. Lifestages are an important guide. Twenty and thirty-year olds aregenerally told to participate to the max in their 401(k) program,Pipes said. Another common thread comes from members havingmultiple plans from multiple employers. They're provided the optionof possibly rolling all the plans into a single individualretirement account. Some members have expressed concerns with thenumber of companies that have frozen their defined benefit plans,Pipes found. "We also talk to them about other assets for theirretirement," Pipes said. "We really want to make sure they'retaking into consideration everything to meet their objectives." Sixmonths after the initial meeting, a follow-up call is made tomembers to see how they're doing and whether any further tweaks areneeded, Pipes said. A number of members have gone on to rollovertheir 401(k) money into IRAs at Wescom, he added. WFS was probablythe first in the industry to convert to an independentbroker-dealer, which occurred in September 2004. Credit unions arebeing encouraged to move their investment programs in house to bein compliance with SEC regulations. Meanwhile, Pipes said WFS haskept in mind ways to keep the program from going staid. At certainbranches, it will only be introduced once a year while at othersbetween two and three times annually. "We want to focus ondifferent elements and different needs so that this doesn't becomestale," he said. "Whether it's college planning or long-term care,we know we need to change the subjects around to keep theinterest." As with many in the industry, the challenge is gettingthe word out that their credit union even offers investmentservices. Pipes said the penetration rate at Wescom is less than5%. Still, one of the goals is to always continue to buildlong-term relationships. "This (program) is another arrow in ourquiver," Pipes said. "If you can introduce members to investmentservices, you might have a better chance of increasing penetrationand awareness." -

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