Lincoln now offers plan sponsors the option to engage with Ibbotson Associates, a registered investment adviser and wholly owned subsidiary of Morningstar, Inc., to provide discretionarily managed custom model portfolios with ERISA 3(38) coverage.
ERISA section 3(38) allows defined contribution plan sponsors to hire a registered investment manager and transfer investment-related liability to the investment manager for the oversight of plan investments.
The LifeSpan program uses an administrative platform that provides consultants and plan sponsors the ability to develop customized asset allocation models for participants, such as target-date and target-risk portfolios, utilizing the investment options from the plan’s existing lineup. The open architecture platform is available for plans in Lincoln’s small-to-large retirement plan program and to consultants and advisers who wish to act as an ERISA 3(21) investment advice fiduciary or a 3(38) investment manager fiduciary.
Now, the Lincoln LifeSpan program affords plan sponsors and consultants the option to delegate the fiduciary responsibility associated with developing, monitoring and updating the model portfolios to the investment expertise of Ibbotson Associates. Ibbotson Associates will create a series of model portfolios, including target-date, target-risk and retirement income, based on its patented lifetime asset allocation methodology. Ibbotson will use the plan lineup's investment options, which undergo rigorous analysis and are carefully selected by plan sponsors and consultants, to implement the diversified model portfolios.
Under this program, plan sponsors or their consultants may choose from a variety of model portfolios designed to accommodate varying participant investment objectives, including:
• Target-date models;
• Target-risk models;
• Retirement income models for investors closer to retirement; and
• Combination target-risk and date models offering participants a choice of conservative, moderate or aggressive glidepaths based on their years to retirement and risk preference.
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