managed account providers

6 Questions to Ask When Evaluating Managed Account Providers

The popularity of managed accounts is bringing more providers into the managed account providers market. As little as five years ago, plan sponsors were captive to a single managed accounts provider being associated with a recordkeeper. Because this is no longer the case, plan sponsors often have a choice between managed account providers.

How you do choose the right managed account provider?

As a fiduciary, you are responsible for selecting the right managed account provider for your organization.  How do you decide? Where will you find differences between managed account providers? As with any evaluation, getting the right answer depends on asking the right questions. Here are 6 key questions we ask when getting started in a managed account provider selection:

Question #1: What’s your investment philosophy?

The underlying investment philosophy differs across managed account providers. Some are proponents of a passive management approach while others acknowledge the benefits of active management. The approach you take should align with the demographics of your plan participants. Will they do their own retirement planning research? Or are they best served by having their investments more closely managed by a seasoned investment advisor? Another thing to look at is how they are making capital market assumptions, which is always an important factor in determining basic portfolio allocations. Some providers adjust their assumptions annually and others make quarterly adjustments.  Read more

Plan Sponsors Fiduciary Duty

Plan Sponsors Have a Fiduciary Duty to Monitor Investments

Are you a plan sponsor?

In 2015, the Supreme Court unanimously ruled that ERISA fiduciaries have a continuing duty to monitor plan investments. While this outcome had little in the element of surprise, it presents an opportunity for plan sponsors to review their benefits provider governance structure.

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