401(k) Managed Accounts – Simply a Method of Delivering 401(k) Advice

401(k) managed accounts and 401(k) advice are often considered two entirely different things in the retirement plan industry. Apples and oranges? I find this odd, to put it lightly. The ’01 SunAmerica Opinion opened the door for participants to receive advice or account management on a fee for service basis. Specifically, the following is the text from the SunAmerica Opinion, which simply states both investment advice and “discretionary asset allocation” (aka account management/managed accounts) are available:

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A Model for 401(k) Advice, Pt. 2 – Must be Ongoing

A fiduciary relationship is one which is ongoing, in which the fiduciary is responsible for conducting ongoing due diligence on the various provisions for which they are responsible. A company fiduciary is charged with the responsibility of ongoing due diligence of the various fees, investment options, and vendor capabilities of the plan for the benefit of the participants. An ERISA fiduciary, regardless of the “flavor,” is hired to provide ongoing advice to the employer specific to investment due diligence and advice, vendor benchmarking, etc. Both of these more traditional fiduciary roles are ongoing relationships. Why isn’t employee fiduciary advice?

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18 Minutes on the New DoL 401(k) Advice Proposal

Our friend Jason Roberts, Partner at Reish and Reicher, has been closely monitoring the regulatory developments of 401(k) advice since the passage of the Pension Protection Act of ’06. The link below provides a brief, yet detailed overview of the regulations and what employers and advisors should take into consideration when it comes to the advice 401(k) investors receive. It is definitely worth the time.

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New on LinkedIn: The 401(k) Fiduciary Advice Group

LinkedIn has been something I have been active on for over two years. It’s Groups feature has helped it evolve into a resource in which busy professionals can learn or get free guidance and feedback on various topics of interest. Personally, our company has benefited from other’s experience and expertise to the tune of saving thousands of dollars on various projects.

That being said, with the recent developments in 401(k) advice, we decided to create a group to help keep employers and advisors apprised of the regulatory and market developments that result from the clarifications. We launched the 401(k) Fiduciary Advice Group on Wednesday morning, and since then, there have been over 70 employers and 401(k) industry professionals join. Interested? Simply click the link below to join.

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