A lot has happened in 15 years

I was at a plan sponsor event regarding fee disclosure in one of my favorite places, Times Square (especially because I remember what a sewer it was 30 years ago as a kid).

To my amazement, one of the plan sponsors indicated that they had no financial advisors working on their plan and that the investment lineup hasn’t been changed since 1997. That’s 15 years ago and there has been a lot of change in the past 15 years. GM was considered a half decent investment back then, Washington Mutual was considered a must own bank stock, every company with .com at the end of their name was a winner. Heck, I was still in school.

It just shows that there is an ocean full of retirement plans out there that have huge fiduciary issues such as no investment policy statement, no change of investments, and no investment education to plan participants. The idea behind participant directed plans was to limit liability, but if a plan sponsor fails their duty under ERISA Section 404(c), then they will be more  liable for liability than if they would have selected the investments on their own with the help of a financial advisor.

The more I’m out there; the more amazed sometimes how many plan sponsors need our help.

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