Huntington Bancshares Inc.'s wealth management arm aims to leverage "The Year of the Roth" into a closer relationship with its customers.
The Columbus, Ohio, company is selecting for a direct mailing roughly 4,000 Huntington Investment Co. customers who have IRA assets. Belinda Sherman, a senior vice president and national sales manager at Huntington Investment Co., said that after the mailing the unit's 150 financial advisers will personally follow up with clients to tell them about the benefits of converting.
Robert Comfort, the president of Huntington Investment, said the goal is for advisers to discuss Roth individual retirement account conversions with clients and, perhaps more important, their overall financial picture.
"We view this as a chance to talk comprehensively to our customers about their retirement planning strategy," Comfort said. "This is an opportunity to approach them with urgency."
"We believe this is a healthy opportunity to get an appointment with our customers and then get in-depth about their overall plan," he continued. "Markets have changed. The industry has spent so much time thinking about asset growth that now we have to change the conversation to talk about income planning and how clients can make these savings last through retirement."
Analysts said some wealth management providers have dubbed 2010 "The Year of the Roth" because anyone with an eligible rollover distribution from a company plan or an IRA can convert that distribution to a Roth IRA, regardless of income or tax filing status.
The $100,000 income ceiling for Roth IRA conversions has been permanently repealed, which means high-income clients can now convert their IRAs. Married individuals filing separately also can convert.
After the initial mailing to the targeted group of Huntington Investment's customers, the unit plans to target customers of the bank who are between 40 and 60 years old and have $100,000 to $500,000 of investable assets, Comfort said.
But Huntington Investments may find it hard to convert many customers. Though a number of wealth management companies are discussing IRA conversions and pushing Roth calculators, investors remain wary about converting. In a report released in December on a survey of 1,000 retail investors, TD Ameritrade said 44% of those with a retirement savings account that could be converted to a Roth IRA were still undecided about whether to convert.
This shows it is critical for advisers to follow up directly with investors, Sherman said.
"A lot of people are providing information and a lot of companies are offering Roth calculators, but this is a personal decision for customers," she said.
"This is a personal discussion, not a calculator decision."