Automatic Risk Reduction combines the simple, automatic
changes from the popular target retirement date funds with Conrad Siegel's
transparent risk-based portfolios. Participants will be able to select an
appropriate risk-based portfolio that will automatically become more
conservative as they age.
According to Tara Mashack-Behney, president of Conrad Siegel
Investment Advisors, few participants take an active role in managing their
401(k) plan and desperately need an automated system that will adjust their
risk level over time to reach retirement goals. "The Automatic Risk
Reduction Program combines the best features of risk-based portfolios and
target retirement date funds," Mashack-Behney said. She described the
program as one that keeps clients' 401(k) plans and investments simple,
easy-to-understand and effective.
Target retirement date funds have a number of challenges,
such as a one-size-fits-all philosophy, lack of transparency and use of
proprietary funds. The Automatic Risk Reduction program allows risk-reduction
schedules to be tailored to meet individual participant needs along with low
fund expenses and transparency in portfolio management.
As the program is rolled out to existing Conrad Siegel
Investment Advisor 401(k) clients over the next few months, the firm will work
with plan sponsors to determine which features of the program are appropriate
for their employees. Program participants will receive their own risk-reduction
schedule with notifications from Conrad Siegel each time their portfolio steps
down as they move towards retirement.
Conrad Siegel Investment Advisors is a wholly owned
subsidiary of Conrad Siegel Actuaries. More information about Conrad Siegel
Investment Advisors is on their website.