Investment recommendations are only as good as the advisor or firm that is providing those recommendations. When an advisor is acting as an investment fiduciary for a plan, the advisor also assumes responsibility for their investment recommendations. This means they will have a sound and well-documented due diligence process in place to protect both the advisor and the plan sponsor.
SevenHills is partnered with Pensionmark, a respected RIA firm with offices located throughout the U.S., to provide and support a robust investment due diligence process along with useful tools and resources for our plan sponsors. Additionally, SevenHills is a CEFEX-Certified Advisor, which provides our plan sponsors confidence that our due diligence process adheres to fiduciary best practices.
There are two levels of fiduciary responsibility that an advisor can provide for their plan sponsors.
- 3(21) Investment Fiduciary: The advisor has fiduciary responsibility for the investment recommendations they are providing to the plan. The plan sponsor ultimately retains final decision-making authority, meaning the sponsor is also acting as an investment fiduciary.
- 3(38) Investment Fiduciary: The advisor has full decision-making authority relating to the investments offered within the retirement plan. The plan sponsor does not have fiduciary responsibility for the investments, however, they do have fiduciary responsibility for the selection of the 3(38) investment manager.
An advisor would never be both a 3(21) fiduciary and a 3(38) fiduciary. Instead, the plan sponsor determines how much fiduciary support they need, and the appropriate level is implemented.
Selecting the right benefits takes a broad understanding of industry trends and regulations. SevenHills has the advantage of collective industry experience and resources as United Benefits Advisors. Equipped with an independent perspective, our advisors are able to provide objective guidance to help clients achieve their business goals.
SevenHills Benefit Partners News Completing forms properly and timely is important to good benefit management. We are here to partner with you to maximize this service for your employees. Below are three reminders: • COBRA/MN Continuation must be sent on the...read more