Herein lies the potential for a direct conflict of interest. This applies generally to all proxy voting in commingled portfolios.
Tag "401k"
Plan sponsors need to think about it in these terms: Does it make sense to have a pork-belly ETF on a 401k investment menu? How about orange futures?
The process of transferring assets is not without its own liabilities. The exact nature of the fiduciary risk depends on the nature of the transfer.
If you have any experience in the retirement plan business, some predictions just write themselves. As in “an incredible feeling of déjà vu.”
CITs can only be offered within the confines of a trust relationship. That means the plan itself might be structurally different than one that has an investment menu limited to mutual funds.
Eliminating the match and investing a large portion of retirement savings in bonds creates a risk. It may cause the retirement savings to go down in flames.
In the spirit of the season, one might even think of this as “tricking” employees to save. Plans sponsors are already using these tricks.
Participation is one thing. It’s critical that retirement savers build on the momentum of participation and use that to increase the amount of dollars that get contributed to their article. How can plan sponsors facilitate this?
How strong an argument is there for auto-enrollment? Remember, the key feature of the 2006 Pension Protection Act was to encourage auto-enrollment. The SECURE Act has even stronger language.
The Irony Of Taxing 401k Plans To Save Social Security
Worse, if the “alternatives” alluded to by the paper entail government backed programs like Social Security, this could have a debilitating impact on encouraging people to be responsible for funding their own retirement.