Fiduciary Review

  • The Independent Fiduciary Review

    As a company offering a retirement plan benefit to your employees, you are contributing greatly to their future financial security.  You are also assuming serious and important responsibility.

    With heightened regulatory oversight by the Department of Labor, many business employers like you have contacted us to ask:

    ·       What steps should we take as plan fiduciaries to ensure costs associated with our retirement plan and investments meet the standard of “reasonableness” as required by the Department of Labor?

    ·       How can I provide the best retirement plan benefit possible for my employees, stay current with all the new regulations and limit my liability?

    Enter the Independent Fiduciary Review.  Why do such a review?

    From DOL Guide ‘Meeting Your Fiduciary Responsibilities, page eight.

    Fees are just one of several factors fiduciaries need to consider in deciding on service
    providers and plan investments. When the fees for services are paid out of plan assets,
    fiduciaries will want to understand the fees and expenses charged and the services provided.
    While the law does not specify a permissible level of fees, it does require that fees charged to
    a plan be “reasonable.” After careful evaluation during the initial selection, the plan’s fees and
    expenses should be monitored to determine whether they continue to be reasonable.

    As you probably know, the new fee disclosure rules by the Department of Labor required all 401k Plan Providers to disclose all their fees.  This is good for you and plan participants, but what the providers didn’t tell you is it is that the same regulations put the burden YOU to ensure that those fees are REASONABLE.

    So that brings up two questions.

    1.) First WHAT is the DOL’s definition of reasonable?

    2.) And secondly, how do you determine that?

    This is what this review process will accomplish. What do we cover?

    First is to evaluate any fees, hidden or otherwise that are associated with the plan and investments and make sure those fees are in line with accepted industry standards.

    Second is to evaluate the performance and appropriateness of the investments in the plan and ensure your firm is acting in accordance with the investment policy statement, if you have one.  This way you can identify investments that are performing poorly over long periods of time, compare to better alternatives, and perhaps make adjustments.

    Last, we want to evaluate the steps you and your current service providers are taking to ensure you are meeting your fiduciary obligations under ERISA law.  You should at the least have a process in place to document those steps.

    To learn why do a review, download our white paper here.

    Contact us to begin the process of the Independent Fiduciary Review-go here.

    Schedule an appointment now-click here.


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  • Gratke Wealth, LLC is a registered investment adviser in the State of Oregon. The adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.