3(38) Investment Manager Switch is Making a Difference

3(38) Investment Manager Switch is Making a Difference

3(38) investment manager services were discussed after a recent Fiduciary Training Program at Rice University. The Plan Sponsor University Founder and CEO, Fred Barstein interviewed Ms. Heather Voss, Manager of HR, Payroll and Benefit of her organization which employs approximately 75 individuals.

After analyzing alternatives, Ms. Voss and the CFO recognized the benefits and efficiencies that a 3(38) investment manager services can bring to their process of overseeing the retirement plan.

Full Transcript Here

This is Fred Barstein with 401KTV. Just completed a TPSU program here at Rice University and I’m here with Heather. Welcome, Heather.


Heather was reluctantly volunteered and so we really appreciate that. Thanks. Okay if we ask you a few questions?


Before we do, tell us a little bit about yourself, how large your organization is, your role there.

I do the human resources, payroll, and benefits. We have approximately 75 employees at the current time. So I also oversee our 401k.

So you do everything.

I do.

Yes. Very good. And you’re a staff of one, right?

I am.

Very good. So one of the things that you mentioned, which I was very impressed with is, you’ve moved to a 338 investment fiduciary, and just for the benefit of our audience, a 321 investment fiduciary will recommend the fees, the funds, but ultimately the plan sponsor has the decision. The 338, you delegate the decisions making. So this is recent. Why did your company decide to do that?

We decided to do that because I am an HR payroll benefits department of one, so I don’t have the time to really be constantly reviewing the funds and having that overall knowledge of the funds. So we wanted to take that fiduciary responsibility off of myself and potentially our CFO, since we’re both so busy with what we and to do all the other time, that we said, “We want to have somebody that is an expert at this being able to do this.”

Great. So did you use your current advisor or did you have to change advisors to find the 338?

No, we’re using our current advisor. They brought us the different solutions, the 338, the 321, and was giving us the options and we decided we wanted to go with the 338.

And that was, are they using a third party or they’re doing the 338 themselves?

No, we’re using a third party.

You’re using a third party, but they oversaw that process-


… on it. So it’s still new. How have you seen any difference?

Well, yeah. I’ve seen small differences so far just in the sheer fact that we had some really bad funds, and we had discussed it with our advisor and they were able to come in and say, “Here is your new funds.” We went through the whole process, walked through it step by step, looking at new funds, and picking those out to get our initial setup. And then they have sent us reports on what everything is doing.

So you’re seeing improvement immediately?


All right. Well, it makes a lot of sense. So our final question. A couple of things you learned today that you want to take back when you go?

The biggest thing is employee education and making sure that we really have them involved in the process and asking them and giving them surveys more. We haven’t been great at our education besides quarterly, and we really want to get them more involved. So that was a really big thing. And also making sure that we work with our advisors to have complete transparency on all of our fees.

The fees are a big issue.


Well, thanks for your time today.

Thank you. It was a great seminar.

Great. Thank you. Thanks for participating, and thank you for watching 401KTV.


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