Many plan sponsors are recognizing the complex responsibilities tied to managing retirement plans. While ERISA requires them to act as prudent experts, most lack formal training. Fortunately, much of the work and liability can be outsourced to independent fiduciary advisors.
TPSU simplifies this by comparing plan roles to the healthcare system: advisors are like doctors overseeing the plan, while record keepers, TPAs, and asset managers play supporting roles. Even when outsourcing, sponsors must ensure vendors are qualified—ongoing due diligence is critical.
Advisors often handle vendor reviews, but they shouldn’t evaluate themselves. Independent reviews bring objectivity, especially as advisors expand their role beyond fees and funds to include financial wellness and benefits integration.
Most sponsors already use independent advisors and rate them highly. Still, many are open to third-party due diligence as fiduciary liability increases and scrutiny tightens. In today’s environment, advisor due diligence isn’t just smart—it’s essential.
Read more insights in Fred Barstein’s latest Wealth Management article, “Advisor Due Diligence: The Most Critical Duty of a 401(k) Plan Sponsor.“
