Before you start to panic, take a deep breath and relax. The retirement savings industry is an aircraft carrier. It can’t turn on a dime.
Tag "fiduciary"
Sometimes when you try your best, you still miss something important. And that could be the most dangerous miss you make.
Today, the understanding of conflict-of-interest fees goes well beyond plan sponsors. Individual investors also understand how they can act as a better fiduciary for their own personal investments.
All these strategies can be employed today and have proven themselves effective. It’s unclear that disclosing projected retirement income will provide the kind of incentive that will work.
If a fiduciary must vote proxies, following the DOL’s guidance may represent the most practical alternative.
ESG isn’t going away. There’s no way of telling if it’s a mood ring or a diamond ring. One thing is eminently clear: ESG is a product that people want right now. This complicates life for the retirement plan fiduciary.
One of the biggest risks inherent in MEPs/PEPs is coordinating all of the many moving pieces. Here’s why people might be wrong to think they know enough about assembling a 401k MEP/PEP and regulatory compliance only heightens the potential liability.
The most pertinent issue may not be the fiduciary imperative, but the marketing imperative. This makes things extremely difficult for the 401k plan sponsor who may sometimes confuse which has priority. Here’s an example of why a plan sponsor might be concerned.
“That is one of the key weaknesses of the SEC’s Reg BI. It allows brokers to claim they are working in an investor’s best interest without being held to a legal duty of loyalty”
Despite the better intentions of finance professors a generation ago, the market regularly fails the efficiency test. The scary reality is not a question of what degree of market inefficiency exists, it’s that market inefficiency exists at all. And that can harm investors.
