The Frugal Fiduciary Blog

Picking 401k Investments and Related Services Is Easy When Fiduciaries Know Their Options

Posted by Eric Droblyen on Apr 6, 2016

ERISA responsibilityWhen a small business sponsors a 401k plan, several investment-related decisions must be made by fiduciaries. Dramatically different fees and expenses can result from this decision-making, so fiduciaries should know their options in order to make “prudent” decisions on behalf of plan participants – an obligation under ERISA. Otherwise, personal liability can result.

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Topics: 401(k) Investments

401k Participants Should Leave Investing to the Pros; Focus on Saving

Posted by Eric Droblyen on Jun 3, 2015

Saving for retirement is one of the most important things we must do during our working years.  After all, nobody can work forever and living expenses don’t stop after you stop earning a paycheck.  And yet too many of us aren’t saving enough for retirement.  Why is that?  For workers that can afford to save, I think the number one reason is the inability to cut through the complexities of saving and investing.  Today, workers must answer complicated questions to successfully participate in a 401k plan.  I believe these questions scare a lot of workers away from giving their savings enough thoughtful consideration.

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Topics: 401(k) Investments

Watered-Down Fiduciary Rule May be the Best Case Scenario for Investors

Posted by Eric Droblyen on Apr 22, 2015

On April 14, 2015, the DOL proposed its long-awaited fiduciary rule designed to protect retirement plan savers from conflicted investment advice. A fiduciary rule was originally proposed in 2010, but it was withdrawn the following year in response to industry opposition. The stakes are high. According to a White House Council of Economic Advisers analysis, conflicts of interest cost retirement plan investors $17 billion per year.

Like the 2010 proposal, the 2015 proposal generally requires financial advisors serving retirement plans and IRAs to operate in a fiduciary capacity, putting the interests of their clients before their own. However, the 2015 proposal adds several new carve-outs and exemptions not found in the 2010 proposal. 

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Topics: fiduciary, 401(k) Investments

Evaluating 401k Providers: Separating Commodity from Value-Added Services

Posted by Eric Droblyen on Feb 10, 2015

Selecting competent service providers is one of the most important fiduciary duties of a 401k plan sponsor – and it can appear daunting at first glance. Fortunately, this process can be made much simpler by understanding each service that makes up a 401k plan and applying appropriate benchmarks to those services to measure their value. Once you’ve done that, you’re ready to pick 401k providers based on the value of their services.

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Topics: 401k plan sponsor, 401(k) Investments, 401k blog, 401k fees

Reforming Roth provisions may be key to improving savings rates for Millennials. My proposal.

Posted by Greg Carpenter on Nov 20, 2014

Roth 401k & Millennials
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Topics: small business retirement plans, retirement plans, 401(k) Investments, Roth 401k, 401k blog, 401(k), Millennial Employees, tax benefits, 401k participants

Let’s put “Income” back in ERISA

Posted by Greg Carpenter on Nov 13, 2014

ERISA
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Topics: small business retirement plans, low cost 401(k) plan, retirement plans, Defined Benefit Plan, 401(k) Investments, 401k blog, Vanguard 401k, small business 401k, 401(k)

Small business owners are redefining the market for 401k plans. Result: Mass market “products” are about to go extinct.

Posted by Greg Carpenter on Oct 28, 2014

Small Business 401k Plans
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Topics: small business retirement plans, retirement plans, 401(k) Investments, 401k blog, small business 401k, 401(k)

Hiring an ERISA 3(38) Investment Manager can be the simplest way to limit 401k investment liability.

Posted by Greg Carpenter on Oct 15, 2014

401k Investment Liability
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Topics: ERISA 3(38) Investment Manager, small business retirement plans, 401(k) Investments, 401k blog, ERISA 3(21) Investment Advisor, small business 401k, 401(k), Investment Policy Statement (IPS)

New companies are trying to fill the gaps in 401k fee disclosure regulations. Here’s why they all fall short.

Posted by Greg Carpenter on Aug 15, 2014

Plan re-enrollment
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Topics: small business retirement plans, 401k fee disclosure, 401(k) Investments, 401k blog, 401k Help Center, 401k fees, small business 401k, 401(k), Form 5500, DOL

Wall Street Journal article proposes sweeping changes to improve small business retirement plans – including simplifying fee disclosures and requiring index funds. Here’s our analysis.

Posted by Greg Carpenter on Jun 20, 2014

Photo credit: WSJ Live
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Topics: retirement plans, index funds, fiduciary, 401(k) Investments, 401k blog, Fee Disclosure, small business 401k, 401(k)

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