Finding the Right Fiduciary: Our Approach to Guiding Corporate Retirement Plans

For employers, it is vitally important to ensure employees have purpose in their work, feel valued and respected, and are provided opportunities for growth and career development. In addition to their career, it is also of critical importance that they feel financially confident both in the present and into the future.

When it comes to financial well-being, employer-sponsored retirement plans are among the most effective ways of imparting the message to employees that their financial future matters to the organization and to the executives tasked with managing those plans. With an estimated $5.2 trillion in assets invested nationwide as of December 31, 2018, 401(k) plans are one of the most popular investment options available. This is not much of a surprise considering the fact that Fidelity 401(k) plans with a balance of $1 million or more increased 41 percent between Q2 2018 and Q2 2019.

Whether it is working directly with a 401(k) plan sponsor, alongside an employer and their investment committee, or through a named trustee, the Welch Hornsby team acts as a diligent fiduciary partner to optimize corporate retirement plans to best fit your employees’ and your organization’s goals.

As a plan fiduciary, we take great care to follow the guidelines put forth by the Employee Retirement Income Security Act and to make the most informed decisions that generate the best possible outcomes for our clients.

To that end, we serve in two different capacities: 3(21) Fiduciary Services and 3(38) Fiduciary Services.

3(21) Fiduciary Services

In this role, we provide non-discretionary advice to an investment committee, which includes assistance from our team in recommending investments to the plan sponsors, monitoring those investments and making recommendations as appropriate, and advising the plan sponsor in the fiduciary process, including the Investment Policy Statement.

In this capacity, we serve more so in the advisory role by ensuring there is a streamlined procedural process in place and periodically reviewing plan documents against processes to ensure the plan is operating in accordance with those documents.

3(38) Fiduciary Services

This consists of a more hands-on role through the discretionary management of the 401(k) investment menu. Some of the services we offer in this capacity include the complete management of the investment plan process by making decisions on the investment options that are offered in the plan, monitoring the performance of the plan and making adjustments as needed.

As the fiduciary, we work with the plan sponsor and investment committee to set the course of an investment plan by determining the goals and objectives and developing an investment Policy. This allows us to choose an appropriate fund menu so participants can create a fully diversified portfolio. This relieves the organization’s investment committee of the responsibility to the investment.

Through both of our 401(k) fiduciary services, we take great care and act prudently to ensure we provide a plan that maximizes available benefits for an organization and its employees. We welcome the opportunity to discuss your organization’s 401(k) plan and how our approach can help with your employees’ long-term financial success. Contact us here to set up a meeting.

The information and data contained herein has been obtained from sources believed to be reliable, but is in no way guaranteed by Welch Hornsby as to its accuracy. Opinions and projections are as of the date of their first inclusion herein and are subject to change without notice to the reader. As with any analysis of economic and market data, it is important to remember that past performance is no guarantee of future results.

Written by Kim M. Elliot, AIF®