The Perfect Corporate Retirement Plan for Your Company
The following is adapted from The Fiduciary Formula by Josh Itzoe.
I am more convinced than ever that the financial future of our country is built on the foundation of our existing retirement system. The financial success of every American worker covered by an ERISA (Employee Retirement Income Security Act) plan depends on our current generation of fiduciaries. They need us to exhibit courage, to exercise prudence and good judgment, and to fulfill our responsibilities as their representatives, protectors, and stewards.
My professional purpose is to make ERISA fiduciaries smarter. I strive to educate, coach and inspire people in positions of decision-making authority to raise the bar. This book takes all that I’ve learned over the years as a successful retirement plan advisor and presents it in an introductory framework for members of the “fiduciary ecosystem.”
The Fiduciary Formula is designed to be an actionable set of research-based ideas, best practices, and strategies that, when combined, creates better outcomes for everyone involved.
Let me define what I mean by the “fiduciary ecosystem.”
If you fall into one of these categories, my book, The Fiduciary Formula, is for you.
1. Part-time fiduciaries — These are named fiduciaries, plan trustees, and retirement plan committee members who have primary decision-making authority (known as “discretion” in ERISA) for the corporate retirement plan(s) at their organizations. They are rarely experts in retirement, investment, or fiduciary matters. They usually have little, if any, formalized training. Their primary job is not the retirement plan. Instead, they work in areas like finance, accounting, human resources, and operations. They are usually at an executive or management level (e.g., CFO, VP of HR, etc.).
2. Full-time fiduciaries — These are registered investment advisers or discretionary trustees, usually with a specialized focus on retirement plan consulting. They work with ERISA plans as a 3(21) and/or 3(38) fiduciary, either at the plan level and/or the participant level. They provide a broad range of services and deep fiduciary expertise to plan sponsors and participants.
3. Part-time fiduciary support staff — These are employees who support the part-time fiduciaries at their companies. They may work in accounting, payroll, or human resources. They are not formal committee members, and they don’t have decision-making authority or discretion. They are responsible for implementing the decisions made by the fiduciaries. They help administer the retirement plan on a day-to-day basis and perform “ministerial” functions as defined by ERISA. This could be an HR generalist or benefits coordinator who provides enrollment materials or benefits information to new hires or submits enrollment forms to the plan’s recordkeeper. It could also be a payroll specialist who remits contributions to the plan or processes deferral changes.
4. Full-time fiduciary support staff — These are industry professionals and experts who range from recordkeepers to third-party administrators to plan auditors to ERISA and beyond. While the work these people do isn’t considered fiduciary in nature, they are essential to the successful operation of a retirement plan, providing valuable support to both plan sponsors and participants.
There is no perfect corporate retirement plan.
But there is a perfect corporate retirement plan for every company based on its unique goals, objectives, and resources. Using the Fiduciary Formula, I believe you will take steps to optimize your plan (or the plans you work with) for successful outcomes. It’s also part of a broader platform of resources I created called Fiduciary U, which consists of a podcast, a blog, online courses, and other helpful resources. Visit FiduciaryU.com to learn more about and to download free tools and resources referenced throughout the book. Thanks for reading!
To learn more about the perfect corporate retirement plan for your company, you can find The Fiduciary Formula on Amazon.
Josh Itzoe is a co-founder, partner, and chief strategy officer at Greenspring Advisors, a registered investment advisor (RIA) and the 2018 PLANSPONSOR Retirement Plan Adviser of the Year — Small Team. He is also the host of the Fiduciary U podcast and creator of FeeMetri(k)s.
A passionate advocate for fiduciary principles, Itzoe is also the author of one of the retirement industry’s most well-known books on fiduciary responsibility for defined contribution plans, Fixing the 401(k): What Fiduciaries Must Know (And Do) To Help Employees Retire Successfully. This is his second book.
