If a fiduciary feels carrying out legal duties entails a high cost, there is an acceptable strategy for dealing with this, but the fiduciary must execute it before the client signs the contract.
Due Diligence
In general, there are some simple rules to follow. That being said, just because the rules are simple doesn’t mean you should follow them.
Unlike previous definitions, this version takes a definitive step towards allowing plan sponsors to forgo traditional financial measures. Rather than relying on extensive academic studies, this new Rule represents a certain leap of faith.
Even without these extremes, this asset class brings with it a roller coaster experience, something many retirement savers won’t be able to stomach.
Before you get all excited and look to replace your home equity loan with a 401k loan, you should consider these things.
There might be a there, there. It could be that TDFs have an Achilles’ Heel that leaves them vulnerable.
401k Plan Sponsor Fiduciary Question: Is ESG an Investment Strategy, a Fad, or a Political Football?
More worrisome to 401k plan sponsors is the potential demand for ESG investments on the part of plan participants who may be driven toward these investment products not for investment performance, but to “make a statement.”
It’s clear that 401k plan sponsors ought to educate themselves when it comes to managing their investment provider relationship. This is the broadest fiduciary liability risk area. If plan sponsors don’t pay close attention, they may find themselves gasping for air.
Nobody’s perfect. It’s unfair to expect recordkeepers to be. Everyone makes mistakes—even recordkeepers. The problem is what happens when a mistake occurs.
Among the tactics introduced by behavioral finance is the notion of “framing.” For individuals, however, it’s much easier to understand things if they are reframed into “buckets” representing specific individual goals.
