This broader definition of fiduciary may impose a potential hardship on a segment of the retirement industry that has been trying hard to gain a foothold in plan infrastructure.
Tag "Ron Surz"
The antiseptic compliance regime spelled out by the DOL and ERISA has to date defined fiduciary services. Perhaps, if we’re going to consider what is “beyond” that sterile definition, we might want to go back to the future. In a sense, rediscovering where “fiduciary” initially came from might suggest where it is headed.
Back then, at least, we knew who wore the white hats and who whore the black hats. Today, thanks to muddled and often conflicting regulations for multiple agencies, everyone is wearing fifty shades of gray.
So what if a few very high net savers end up with bigger retirement plans? Good for them. The point is to make it easier for more people to save more.
The Biden Rule, like the Trump Rule, does not encourage or discourage the use of ESG criteria when selecting investments. This allows fiduciaries to either adopt ESG principles or ignore them.
By far, there’s almost universal agreement that 401k fiduciaries should be less concerned about investment performance than you might have seen a generation ago. Why is this so?
Not only do you need to watch the place that holds all the money, you need to watch the pipeline that feeds the money there.
As with many things, hands-on instruction is generally the best way to achieve this, especially if you make it into an engaging workshop that’s all about the employee and the employee’s dreams, not about the plan.
The conflicts-of-interest inherent in selecting proprietary funds are apparent. Less so are the criteria used to determine what a suitable process might be.
The problem with Sequence of Return Risk is that there’s no way of knowing if you’ll experience it. It’s a roll of the dice. The best way to avoid this risk is to prepare as if it were going to happen.
