Investment Committees Misnamed Causing Confusion by 401k and 403b Plan Sponsors. Traditionally, the governing committee for 401k and 403b plans have been called “investment committees” which can cause confusion and might even be harmful. We think they should be called “retirement committees” or even “benefits committees”. Here’s why.
Though the role of investments is important to plan sponsors and participants, the committee needs to focus on other matters which will have a greater impact on employees and the organizations including:
- Plan Design
- Fees v. value
- Employee engagement
- Compliance and fulfilling fiduciary responsibilities
The most important investment that committees should focus on is their default option or QDIA, which is usually a target date fund, followed by capital preservation funds like stable value, money market or fixed income for participants that do not want to take risk
Ultimately, the committee should focus on all benefits including retirement which is becoming entwined with healthcare, especially HSAs.
Latest posts by Fred Barstein (see all)
- 401k Plan Fee Benchmarking is a Valuable Exercise - August 18, 2018
- To Borrow or Not to Borrow from a 401k Plan? A Tough Question - August 15, 2018
- TPA Critical to 401k plans during Mergers and Acquisitions - August 15, 2018