Conducting a periodic plan diagnostic test is often seen as an easy way for the typical 401k fiduciary to reduce fiduciary liability. An ERISA plan trustee or fiduciary will usually hire an independent fiduciary consultant to conduct a comprehensive plan fiduciary diagnostic test. Here are five critical areas to consider.
Tag "liability"
The Supreme Court will raise the visibility of the fee structure within the investments of nearly half of all 401k plan assets. Just because the powers that be say it’s so, doesn’t necessary mean your average fiduciary can rely on the decree. Indeed, the Supreme Court of the United States appears poised rule in favor of mutual fund shareholders, yet, at the same time, mislead both 401k investors and fiduciaries.
A mutual fund’s expense ratio represents only one factor in analyzing the appropriateness of a mutual fund as an investment. Other factors may in fact be more important (including, among other things, portfolio manager tenure, number of holdings, total net assets, investment objective and consistency of returns).
An employee places much trust in an Employee Retirement Income Security Act (ERISA) fiduciary. Because they have the responsibility to act on behalf of retirement plan beneficiaries, plan fiduciaries are held to certain standards of conduct by the United States Department of Labor.
