Who will attend meetings? Who will prepare reports? Who will respond to participant questions? Who will provide investment recommendations? Who ultimately bears fiduciary responsibility?
Tag "3(38)"
An employer should look at what they need to do to attract and maintain talent. Once a need is established, the employer must assess all the different technologies and services a 3(38) can provide.
ERISA does not require fiduciaries to predict market tops. It does, however, require a prudent process for selecting and monitoring investments.
That is the line committees cannot afford to miss. They cannot interfere, but they also cannot ignore. Those two verbs define the narrow lane that fiduciaries must stay in if they want delegation to work as intended.
Seasoned advisors caution plan sponsors not to confuse delegation with disappearance. Every fiduciary duty can be shared. None can be erased.
By proactively addressing these critical 401k plan sponsor questions, sponsors can enhance their plans, protect participants, and shield themselves from unnecessary fiduciary exposure.
Here’s the real conundrum faced by 401k plan sponsors: They realize they don’t have the expertise to administer the plan. So, what do they do? It’s only natural they do seek outside help for their retirement plan. The trouble is, not all third parties are created equal. But does the average plan sponsor know this?
Not only do pooled plans reduced the administrative burden, but they can also reduce the fiduciary liability for 401k plan sponsors. If you’re not constantly looking over your shoulder, you can spend more time with your nose to the grindstone.
This week we’ll be focusing on those favorite features as judged by the retirement plan professionals we interviewed. Don’t be surprised if over the next few weeks you discover that one provider’s treasure is another provider’s trash.
Should the platform offer ESG doesn’t necessarily mean good news for the 401k plan sponsor. Including ESG funds might introduce other risks.
