Fiduciary Responsibility /404(c) Guide

We want to help you take advantage of the protection that ERISA Section 404(c) offers by providing you with the tools and resources to help you build a strategy to compy with the US Department of Labor's ERISA 404(c) guidelines. By choosing to operate your company's retirement plan under 404(c), you, as an employer, shift some responsibility for making the investment decisions directly to plan participants.

Who is a fiduciary ?
In general, a fiduciary is any person who exercises any discretionary authority or control over a retirement plan. Plan Sponsors and discretionary plan trustees are usually plan fiduciaries.

To fulfill your fiduciary obligations to the plan and its participants, you must:
1. Act solely on behalf of the plan participants
2. Control plan expenses
3. Exercise the same care, skill and diligence as a prudent person would in similar circumstances
4. Diversify assets to help minimize risk, and
5. Adhere to the written plan documents.

Of course, we will guide you step by step to comply with the 404(c) guideline, including creating an Investment Policy Statement.

Investment Policy Statement

An Investment Policy Statement (I.P.S.) helps guide Plan Sponsors through the many alternatives investments available in the market today. It also helps demonstrate a prudent act in selecting funds that are appropriate for plan participants by documenting the decision-making process.
ERISA Section (404)c regulations provide Plan Sponsors with guidelines concerning fund selection, participant investment discretion, and participant communications. To comply with the 404(c), the investment policy statement should describe how the investment lineup, participant control and communication efforts meet the requirements of the code.

There are four components in a policy statement:
1. Excutive Summary
2. Invesment Structure
3. Selection Criteria/ Search Process
4. Ongoing Evaluation