401K/Fiduciary Governance

It not uncommon for plan sponsors to fully grasp that by virtue of offering a 401(k) they in fact become a fiduciary to every participant in their plan. With that fiduciary responsibility comes great opportunity, great responsibility, and for fiduciaries who fail to meet their fiduciary responsibilities they can be held personally liable.

While there are many facets of a plan being a compliant the two biggest areas that a fiduciary is responsible for that can dramatically impact participant outcomes is in the areas of their plan’s investment choices and the various costs associated with the plan. What ERISA and the Department of Labor expect of a plan sponsor is that they have a process in place that ensures that there is a prudent process in the original selection of investments offered in the plan as well as a prudent process for the ongoing monitoring of the plans investment choices. In addition plan sponsors are expected to fully understand all the costs associated with their plan and that those costs are reasonable in light of services being received.

As an ERISA 3(21) fiduciary we work with you to put a process in place that ensures that you’re taking a prudent approach to your plan’s design, assisting your employees in having a successful investment experience, and managing costs relative to the market and services received. We differ from a broker in the sense that a broker is typically is focused on a product based solution and in no way has a fiduciary obligation to you. Our services and advice are based on knowledge based solutions and never driven by a product or commission. In short we become a co-fiduciary with you and we want what you want, a competitive benefit for your staff, a solid investment lineup, and a competitive cost structure.

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