Fiduciary Compliance

Let Us Fulfill Your Fiduciary Responsibilities Over Plan Investments

Employers who sponsor retirement plans are required to meet and maintain certain minimum standards outlined by the federal law, ERISA (The Employee Retirement Income Security ACT of 1974).

ERISA states that you have specific fiduciary obligations to the plan participants and the plan assets.  In a matter of fact, you could actually be held liable for investment losses of plan assets if you do not take specific steps--even in a participant-directed plan.

Unlike many financial advisors we are a fiduciary for our clients. That legally requires us to put your needs ahead of our own when making financial recommendations. That’s not the case with a sales oriented advisor.

Defined Contribution Plans

For employers to relieve themselves of fiduciary duty over investment loses, a plan must, among other things:

• Contain at least three investment choices with different risk and return attributes
• Provide the ability to change investment allocations at least quarterly
• Provide sufficient education and information about the plan to allow participants to make informed decisions

Sounds easy, right?  As with anything that is government regulated, not quite. 

Investment Options

Choosing the funds to offer in a retirement plan is not as easy as it may seem.  According to DOL, the selections must be "in the best interests of your plan and its participants" and must be "materially" different in regards to risk and return attributes.

Educating Participants

Also, most employers don't have the time, and a lot of the time the resources, to devote to training and educating their employees on the plan's investment options and how to properly diversify their portfolio. 

If you do try to educated your employees on your own, you need to be careful not to give specific investment advice to individuals because that may be considered acting as an investment advisor.  If so, you would be required to register as an investment advisor.  This is best to avoid because then you would be required to follow state and/or federal regulations.  

Acting Prudently

Employers must carry these responsibilities out as a "prudent person would carry them out."  The DOL goes on to explain that "...it may be in your best interest to consult experts in the various fields, such as investments...The duty to act prudently is one of a fiduciary’s central responsibilities under ERISA. It requires expertise in a variety of areas, such as investments. Lacking that expertise, a fiduciary will want to hire someone with that professional knowledge to carry out the investment and other functions (DOL)."

Willow Ridge Capital Advisors as Your Solution!

We understand that most businesses who offer retirement plans are not in the financial business, let alone in the business of making sure the investments in the plan are always being watched.  This would take too much valuable time and limited resources.  Willow Ridge Capital Advisers can relieve you of the fiduciary responsibilities surrounding plan investments.