Nationwide announced in a press release that it was teaming with RIA Services, Inc., a Dallas investment management firm, to provide the service through third-party administrators by mid-2002.
RIA’s investment plan will be based on each participant’s goals and risk profile, as well as a continuing economic, market and technical analysis, Nationwide said.
Participants who use the service will pay a fee to RIA and a service fee to RIA Services. Donald Jones, Nationwide Financial Services national sales manager, said the amount of the RIA fees has not yet been determined. He said RIA will select the investment managers involved in the program.
Jones said some plan administrators and sponsors might want to delay arranging for the RIA services until a Congressional reform bill addressing the provision of advice in retirement plans gets approved. “I think that the plan sponsor and the participant will want to know that the jury is still out,” Jones said.
However, he cited the December 14 Department of Labor advisory letter to SunAmerica Retirement Markets in which regulators said 401(k) plan providers may hire independent advice providers without – in most instances – being liable for the quality of the advice.