ERISA requires plan sponsors to regularly monitor investment lineups to ensure they remain prudent—a task made more complicated by the multi-layered construction of target-date funds; a new paper points to the best practices of defined benefit plans for some guidance.
A district court found plaintiffs met the requirements of ERISA Rule 23(a) and the class is maintainable under at least one of the subdivisions of ERISA Rule 23(b).
With the new opinion, the district court seeks to make clear where the line is when it comes to pleading standards in ERISA lawsuits.
For one thing, a federal court judge found the defendants provide no authority supporting their contention that a plan document executed after the participant has ceased participation in the plan can bind the participant to arbitration.
Fidelity confirms that it will soon begin charging a 0.05% fee on assets invested through its platform into Vanguard products.
Looking at asset flow data provided by Wells Fargo, there is very little money going into the standalone index equity fund options being added to DC plan menus—and this is probably a good thing.
The new edition aims to support the needs of employers providing defined contribution plans by enabling service providers to prepare consistent RFP responses, resulting in reduced response times and more accurate evaluations.
Institutional investors with less than $1 billion in assets paid 65% more for investment management than medium-size funds ($1 billion to $10 billion in assets) and 91% more than the largest funds (greater than $100 billion in assets), Callan found.
Proprietary fund lawsuits are viewed by plaintiffs’ firms as one of the types of excessive fee cases that are likely to get past motions to dismiss; and so it stands to reason that more—potentially many more—of these lawsuits are on the way.
Data shows about one-fourth of nonprofit plan sponsors are not aware of what comprises a formal fee policy statement, and half of respondents are unfamiliar with the tenants of fee levelization.
For someone making $90,000 a year, that would jump to $277K, America's Best 401k says.
The complaint seeks to state a claim—without relying on hindsight—by arguing the underperformance of a large cap fund was “virtually guaranteed because it contained a serious design flaw from inception.”
Today, only 69% of assets in retirement plans are in actively managed funds, down significantly from 84% in 1996.
The suit alleges that defendants “breached their fiduciary duties by causing the plan to invest in funds offered and managed by Franklin Templeton, when better-performing and lower-cost funds were available.”
Neither Xerox nor Financial Engines were acting in a fiduciary capacity relating to their fee arrangement, a court found.
The court basically decided Fidelity was not the fiduciary responsible for choosing to provide the advice and SDBA offerings to participants.
Recordkeepers widely identify “reducing plan administration costs” and “maximizing participant savings” as the top two priorities for defined contribution plan sponsors; CITs are also a big focal point.
The tool leverages a 401(k) database to hone in on the often complex fee structure associated with retirement plans.