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Feature:Fiduciary Fundamentals

Illustration By Christopher Nielsen
Fiduciaries are subject to standards of conduct under the Employee Retirement Income Security Act (ERISA) because they act on behalf of participants in a retirement plan and their beneficiaries.

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class="3body-serif" align="left">Fiduciaries are subject to standards of conduct under the Employee Retirement Income Security Act (ERISA) because they act on behalf of participants in a retirement plan and their beneficiaries. However, plan fiduciaries sometimes are not aware that they are fiduciaries—and, even if they are, what that means is not always explained. In PLANSPONSOR 's first-ever Fiduciary Guide, we hope you will find what you need to know to be a better fiduciary.
 

class="3body-serif"> Fiduciary Foundations

Who is a fiduciary? Simply stated, someone who has the power to affect the plan assets, someone who offers investment advice regarding those plan assets for a fee, or someone named in the plan document as a fiduciary.   In fact, if you are reading this, there is a pretty good chance that you are one.   Remember that you can become a fiduciary without intending to—the test is what you do, not what you think or say you are.

Every action must be done solely with an eye toward the good of the participants and beneficiaries, must be undertaken based on the thoughtful consideration of an expert in the subject, and must be done in accordance with the terms of the legal document that describes the plan's purpose, obligations, and operation. Also, bear in mind that fiduciaries are tasked with ensuring that only reasonable fees and services are undertaken on behalf of the plan and its participants and beneficiaries.

Nevin E. Adams
editors@plansponsor.com

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