Episode 62: “Investing for the Future with Technology” with Lisa Kottler, Chief Growth Officer at Sallus Retirement

Matt: I'm Matt Swain and you're listening to the “Reimagining Communications” podcast where we discuss the opportunities and challenges facing companies on the road to optimizing their communications for the future. Today, I'm so excited to be joined by Lisa Kottler, chief growth officer at Sallus Retirement. Lisa, thanks for joining today.

Lisa: Thank you for having me. I'm really glad to be here.

Matt: Yeah, certainly. And why don't we start with a little bit about Lisa? Can you share a bit about yourself and your journey to where you are today?

Lisa: Absolutely. So, you know, interestingly, I tie my career back to when I was about eight or nine years old. And don't worry, I'm not giving you a complete life story. But, my grandmother, she used to sit me down, open the newspaper, and showed me the stocks that she was invested in. And she taught me so much about equity, about ownership, and about the markets in general, or at least as much as an eight or nine-year-old can understand. But I was hooked.

And so, when I went to college, I studied finance. I thought maybe I was going to be a portfolio manager but realized quickly that probably wasn't my personality type. But within about a year or two of graduating, I kind of stumbled into the retirement plan industry. And I've mostly stayed there ever since. You know, first I sold plans to the employers, and then I'd come back and put together all the enrollment materials, print them out, put them in binders, and go out and do the enrollment meetings.

And it was an incredible experience because I got to really know what people thought and really helped them through their financial journey. And I mean, we just don't teach financial literacy in school. That’s probably a whole other podcast.

But, getting in front of them and learning, it was really...it's just been such a rewarding career, for sure. But really being able to help working Americans in ways that they don't otherwise have access to. And today, I'm the chief growth officer at Sallus Retirement, and we're really on a mission to make sure that all Americans have access to a retirement plan at work.

Matt: I think about the other aspect of this, where when you thought about the legs of your financial well-being and retirement, it was a pension, it was your retirement, your 401(k), and then it was Social Security.

And as pension plans have just all but disappeared across the U.S. at least. And Social Security is in question, like how long it will be funded. That then comes back to where we started, how do we get more people into retirement plans, saving earlier to better their lives for the future?

Lisa: It is a looming crisis because if people don't have access to a workplace retirement plan, they just don't do it on their own. I mean, less than 5% of them will go out and set up some sort of IRA or something. So, we have to make it accessible to them at work because, look, if we don't solve for this, then what?

I mean, you just talked about security may not be available, or hopefully it will for some, but we've shifted the funding from employers to the employees, you're right. We went away from defined benefit plans and now they're really 401(k) plans. The employer can take the money out, put it in, they've set up the plan, they've done everything on your behalf. And so, we really have to make sure that we continue to make plans accessible to more and more employers.

Matt: Well said. In previous discussions, you had noted that 9 out of 10 employers don't even offer a retirement plan. And we've made little progress in the last 50 years. Can you share a little bit more about what you mean by that?

Lisa: Yeah. So, look, it's a reality 9 out of 10 employers don't offer a 401(k) plan today. And I know that's a very surprising statistic to most because we just think 401(k) plans are ubiquitous. But it's true because there are 6 million employers who could offer a plan. And that means they have at least one employee or more because that's what's required to offer a plan. So, 6 million could, but today, they're just over 600,000 401(k) plans.

So, in other words, 5.4 million employers still don't offer a plan. And that's really a problem because the data shows us that when people don't have access to a retirement plan in the workplace, less than 5% of them are going to save on their own. So, it really is a looming crisis for us.

Now, Congress helped with that, they passed legislation, two big pieces of legislation over the course of the last three years, so they've really helped to remove some of the barriers for us. But look, you know, legislation is really just words on a page. And it's up to us as the industry to now take that and build the solutions and really deliver on it.

I'd say that our traditional distribution model, it's just really not going to work. It can't work at the speed and scale that we need to really make an impact with those millions of employers that don't have a plan today.

Because how do you reach 5.4 million employers to create that awareness for them? And then how would you bring on millions of new plans into the system unless you leverage emerging tech? And I think that's really where we have to go as an industry.

We have to digitize more of our procedures, our processes, maybe leverage generative AI. That's a whole game-changer right there. You know, that can help us do some of the mundane tasks, it could help us interact with customers, extend our reach.

And then while I think it might be inconceivable to some, I think that we also could leverage blockchain. I see blockchain could be the future of our record-keeping systems. Now, it's way early days for blockchain, so that would take some time. But the bottom line is, we just can't continue to do things in the traditional way and expect to have different results.

Matt: On that note, you teed up the role of emerging technology and thinking about things in new ways. In fact, I think you've spent the last seven-plus years reimagining the retirement savings space, which kind of leads me to this journey over the last seven years. How did that journey align with what you're doing at Sallus today?

Lisa: Well, let me go to where it started, and it was probably 2016. And I started to become enamored with FinTech. And I happened to go watch two different "TED Talks" on blockchain, and I was forever changed. In fact, I couldn't unsee it. You know, I was just fascinated by this technology, thought, "Wow, this is how fast and quickly the world is moving, like, we really have these capabilities now."

And then I went to my job the next day and kind of got back into reality about, you know, where we are as an industry. And look, we're like most industries, we’re having to rely on older technology.

But, again, I couldn't unsee it and I couldn't stop thinking about it. So, I decided to leave my job. I immersed myself in the FinTech world and the startup community. I went to blockchain conferences, AI conferences, FinTech conferences, kind of built a network in that world.

And then I even, a few years ago, got a master's degree in technology commercialization here at UT. And that's really where they teach you innovation principles. You know, how do you take a technology from ideation, all the way through to commercialization.

And then I worked with some FinTechs, kind of helping with their go-to-market strategies, their biz dev. And so now at Sallus, I kind of get to bring those two worlds together. I get to take my decades of experience working in the 401(k) business, and now this knowledge and experience I've gained in emerging tech and apply these innovation principles, to, hopefully, now, build some 401(k) solutions, to make plans accessible to more and more people.

Matt: And I have to ask at those conferences that you're attending, when you said, "I'm in the retirement industry," what came out of that from the other attendees?

Lisa: Well, I felt kind of a lone soldier, there weren’t many of us that were there. In fact, I probably was the only one. You know, it's funny, when you mention you're in the 401(k) business, folks’ kind of start to give you their own personal 401(k) story if they have one. And they only have one if they've worked for large companies. So sometimes I feel like it's more of a sounding board to try to help them manage. But, yes, I was I think a bit of a unicorn at those conferences, there weren't too many of us there.

Matt: But I think it's a great example of why it's so important to attend those conferences and be outside of the normal conferences that are attended by those within your industry because it takes that outside perspective to reimagine your space.

Lisa: Absolutely. I could not agree with that more.

As fantastical and as crazy as some of these ideas sound, you're right, immersing yourself in that is so powerful because the more you can learn from other industries, the more I think we can try to improve what we do for our customers.

Matt: It's a great challenge to listeners for the next year to attend an event outside your industry that doesn't fit the traditional mold of conferences you would normally attend.

Lisa: That's a really...absolutely a great suggestion. You're right, I'm going to steal that and use that when I'm talking to folks.

Matt: Absolutely. So, I have a question with regard to consumer perspective relative to the retirement plans. And this actually aligns with some of what you were saying about rethinking, not only access to it, but once you have a retirement plan, for many consumers, our research showed that they were least likely to say that their retirement firm was providing a great customer experience for them.

Matt: Is some of the complication also industry jargon and unnecessary complexity that could be removed, can we simplify those experiences? Can we remove friction from the process?

Lisa: Oh, my goodness. I mean, you really hit the nail on the head right there. Look, all industries, we all have our own lingo, own jargon. But I have to say, it feels like the retirement planning industry is one of the biggest offenders on this. I mean, just the number of acronyms we have, just looking at the types of 401(k) plans, there are SEPs, and MEPs, and GOPs, and PEPs. I mean, it's extraordinary, the lingo and the jargon. And we've also added layers of complexity that we just don't need.

And so, I think it is really, really critical for us to make sure that we strip away that jargon, strip away that complexity. And that's something we are absolutely laser-focused on at Sallus. And several of us on the team have been in the industry a long time, so we have to be very mindful of that. But we look at every communication we send out over and over to make sure, have we taken out all of that lingo.

Now, sometimes you may have to leave something in.

And have we explained this in a way that anyone really could understand? Getting back to, you know, we don't teach financial literacy in school. It's not that people aren't smart, they couldn't get it, we just haven't taught it to them. So, all the more reason that we should not be throwing this level of complexity at them. Let's make it simple. Let's make it straightforward. And that right there could go a long way, I think, in increasing plan adoption and increasing the participation in plans.

Matt: Lisa, those are great points. And I want to follow up and ask specifically, how can firms remove friction from the experience?

Lisa: Well, you know, Matt, that's a great question. And in fact, maybe it's the question. And it's one that I think we have to ask ourselves consistently and constantly. Look, we know we have to meet people where they are, and where they are is everything mobile, everything digital.

We're all consumers and we're used to pressing a button on our phone, and something shows up at our doorstep, maybe even sometimes within a few hours. And we take that same expectation into all of our experiences, including when we're interacting with our 401(k).

So, I think it's important that the industry really look at every process, every procedure, and always be thinking about, is there a better way to do this? Can we digitize something versus faxing it in, as an example? Are there ways that we can improve it? And this really is about thinking about it through the eyes of their experience, and what can we do to improve it. So constantly ask ourselves that question.

Matt: Excellent. I always have this communications lens, like, the macro, and then the communications lens. And I think about the removal of jargon from the communication as one level. It may be also navigating the regulatory landscape and what needs to be included, what boilerplate is there. Does it have to be the first thing that the recipient sees or is there a better way to position and communicate what needs to be communicated?

Any thoughts on how that kind of the communications aspect of it continues to evolve and some of the inhibitors that might make it harder for that evolution?

Lisa: No, it's a great point. Look, the financial services industry, we are handcuffed sometimes. We are certainly limited because we have so many regulatory bodies that are overseeing us. Particularly true in retirement plan because, most financial services have SEC and FINRA. We also, in the retirement world, have DOL and IRS regulatory bodies.

So, you're right, it's a multitude of things that we have to think about in terms of how we communicate, and we have to ensure that we incorporate all the things that we're required to say. But look, one way that we've tried to make this a little bit more palatable at Sallus, and you have to be careful with this. But we have injected a bit of humor along the way where we sort of take a knock at, you know, some of the jargon and the lingo.

In fact, we actually created a jargon translator. So, we put together a document where we list out where we have to include all the definitions. But in the videos in the ways that we're communicating with our employers and their employees, we kind of throw some humor around that jargon translator and try to have some fun with it. But, of course, these are serious matters, its people's money, and so you have to...you know, throwing humor in is a little bit risky, and you have to be very mindful of how you do it.

Matt: I love that approach. You're right, you're walking a line, but at the same time, when you think about the recipient and the mindset, they’re in, and again, the voice of the customer, like what is this that you're sending me? How do I navigate this? How do I not just get overwhelmed and ignore it? Because frankly, that's often what happens, is if I can’t digest it quickly, most consumers are going to turn away from it or not actually try to absorb it.

Whereas, if you add a little humor, add a little fun to it, may be self-deprecating at times, I think it's a really nice balance and creates a nice opportunity to get more engagement than you would have otherwise.

Lisa: And you alluded to something there too about brevity, and I think that's another key thing. So, the humor is great. We do have a lot that we have to communicate. We've got to really strip out that jargon but be as succinct as possible.

Matt: So, what are some other key themes that you're seeing impacting the retirement communications market?

Lisa: Well, when I think of communication, it's not just what we say, but it's how we deliver it, right? What methods and tools do we use? And, in today's world of YouTube and TikTok, we at Sallus have decided that video is a really great tool because, again, we have to extend our reach to get to the millions of employers that don't have a plan and to their millions of employees. And so, video is a great way to do that.

Historically, from a distribution standpoint, we've really had to rely on wholesalers and financial advisors to get it out there. And as great as they are, and I used to be one. But as great as those folks can be, they're not scalable. So, using video is a great extension to really reach more to create the awareness to build the interest.

And so, we've even created a character if you will, Coach Sally. And we have a whole, like, YouTube-like channel, where whether it's an advisor or an employer, an employee can go on and see videos that are directed to them. And they're snackable, they're short, you know, 60-second, 90-second.

Again, getting back to some of the humor we talked about, she's really great at delivering.

So, it's not what we say, but it's the methods and means that we use to get that out there. And over time, as new tools and new methods become available, how can we incorporate those into our process?

Matt: Is there a world where Coach Sally becomes also generative AI able to respond and have interactive communications as well?

Lisa: Absolutely. In fact, even when we first built it out a couple of years ago, our intention over time was that she really becomes more of a virtual wholesaler. Now, to do that, it takes a tremendous amount of data and time as you know to build out that AI. But, yes, over time, that is exactly how we saw this going. In the meantime, it's these videos that people can come listen and do it in their own time. 24/7. But absolutely, over time.

And look, AI has come a long way, particularly even in the last six or seven months. And generative AI and the ability to create...you can go right now and go take a course and create a chatbot in a few hours. And we as individuals can go do that. And so, it's come a long, long way. So, yes, absolutely. That is a great technology for our industry to leverage going forward to reach the millions of folks we need to.

Matt: Thinking specifically about generative AI, how long do you think it takes for the retirement services industry to embrace something like that?

Lisa: You know, that's a very interesting question because, as I said, we've seen the leaps forward that generative AI has made just in months, right? And so, the expectation is that it's just going to continue to be so quick.

How quickly our industry actually leverages that is a completely different question. But there is so much opportunity. I do know of at least a couple of the large record keepers who have already, over the last few years, been looking at, you know, robots, and what are ways that you can take AI and do some of the mundane tasks and processes.

But now with as far as we've gone with it today and the ability to maybe interact with folks in a way that's much more elevated than the typical chatbots we've been used to over the last few years. So, the opportunity is there. I think there will be some of the larger record keepers who have a bit more resources that will be able to lead the way on this. And so, my hope is that really, over the next two or three years, we do see some significant leaps forward with AI in retirement plan.

Matt: And I think your comments around the technology evolving quickly and then kind of aligning to how quickly it's actually implemented in certain industries are two different conversations. And especially when you're in maybe a more cautious risk-averse industry...the stakes are higher if you screw something up, that often then kind of elevates the risk aversion discussion.

Lisa: Absolutely. Lots of lawsuits and things. So, look, while I often sound like I'm, you know, maybe bashing our industry a little bit because I'm out talking about these things a lot, I certainly do understand. I've been in this business, you know, 30 years now. I certainly understand that we do have these. It is risk, and it is people's money, and we have a lot of regulatory bodies overseeing us, so there really is.

We do have to be very mindful of that as we build out. And we can't be the innovators the first early adopters of technology, usually ever, for those reasons. So, we do have to be very careful.

Matt: If we look beyond generative AI because that's the only thing everybody's talking about today, but if we look beyond that, how do you expect retirement communications in general to continue to evolve in the coming years? And that could be simplifying the communications, it could be leveraging new tech. Any thoughts on that?

Lisa: Yeah. I'm going to sound a bit repetitive. But, putting tech aside, it's the simplicity. We have to get back. Speak English to folks and really put it in terms. And that's not to say...I think sometimes folks interpret that as dumbing down. And that's not what I mean at all. I mean, people are smart, they don't have time and they don't have time to go look up words and lingo.

So just give it to them straight, give it to them quick, and deliver in ways in which they want to consume it. And as we know, again, today, a lot of that sometimes can be around video, audio, podcasts, things like that. Meet them where they are, and that is where they are today.

Matt: Excellent. Lisa, thank you so much for joining today.

Lisa: Well, thank you. I appreciate the opportunity. This was fun.

Matt: Absolutely.

Matt: I'm Matt Swain, and you've been listening to the "Reimagining Communications Podcast." If you liked this episode and think someone else would too, please share it, leave a review, and don't forget to subscribe.

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