What's in it for me?
All too many participants as well as a surprising number of plan sponsors have unrealistic expectations for Internet-based advisory services. Participants expect these services to give them a magic formula for achieving retirement security. Plan sponsors also believe advisory services provide a magic formula, but for quickly and easily fulfilling their fiduciary obligations to their participants.

A wolf in sheep's clothing
The truth is advisory services don't provide magic formulas for anyone. Further, most of them aren't in a hurry to make this clear to participants. These are sales organizations, after all, and they want participants to believe their advisory products are inexpensive yet highly scientific solutions to the problem of retirement planning.

However, all advisory services have two dark secrets-the fragility of their assumptions and the sensitivity of their models to changes in input (much of which comes in the form of the advisory services' assumptions). The combination of these two factors means that the projections made by advisory services will almost certainly miss the mark. The only question is whether reality will be better or worse than projected and by how much? Of course, no one knows.

The cure might be worse than the disease
If participants do not understand the limitations of the advisory service they are buying, the cure (advice) can turn out to be much worse than the disease (employee ignorance). If the capital markets don't cooperate, participants (who will have followed the recommendations of plan sponsor-endorsed advisory services but come up short at retirement) and their litigators will come knocking on plan sponsors' doors (and those of their bundled providers) in droves. And, it's not at all certain that the probability distributions some of these services show will afford adequate protection.

Managing participant expectations and protecting plan sponsors
Is an Advisory Service Right for Me?™ can help both participants and plan sponsors get the most out
of an advisory service.

• It is written by an objective third-party registered investment adviser.
  
  
• Participants can go through the screens in about ten minutes, just a fraction of the time it takes to participate in a meaningful initial session with a real (human) advisor. Each screen is written in language comparable to Winnie the Pooh's Bedtime Stories and 101 Dalmatians.
  
  
• If positioned before participants can enter the advice giver's Web site, Is an Advisory Service Right for Me?™ provides the plan sponsor with a powerful defense against accusations that participants were mislead about the effectiveness of the advisory process. A participant may actively choose to ignore Is an Advisory Service Right for Me?™, but then it will be the participant, and not the plan sponsor, who must defend his actions. Remember the old proverb: you can take a horse to water, but you can't make it drink. What is important is that the product was there and that the participant intentionally skipped it or conveniently forgot it.
  
  
• Participants are told that the advice giver is selling an imprecise process. Following the recommendations may not get them to where they will want to be. After all, professional advice givers can be off the mark just as easily and as often as participants themselves.
  
  
• Since the advantages and limitations of advisory services are clearly outlined, participants will not be able to say, at some future date, that they were mislead by sales hype and that the plan sponsor, either implicitly or explicitly, endorsed this hype.
  
  
• The participants are also reminded that using an advisory service is not a substitute for becoming an informed investor.

Customization
The user interface can be readily adapted to fit the design of your Web site. The text can also be modified. For example, the section on risk tolerance questionnaires can be deleted if your advisory service does not use them.