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Investment Fiduciary

A plan sponsor may delegate responsibility for investment-related decisions to a qualified professional. Generally, this also transfers liability for the investment decisions made for the plan. These kinds of arrangements include:

  • A 3(21)(A)(ii) fiduciary: A limited-scope investment fiduciary recommends rather than authorizes the selection, monitoring or replacement of investments.
  • A 3(38) fiduciary: An investment-manager has discretion over plan assets and is responsible for selecting, monitoring and replacing investments.
  • A 403(a)fiduciary: A discretionary trustee must discharge its duties with respect to the plan:
  • solely in the best interest of the participants and beneficiaries; and
  • for the exclusive purpose of providing benefits to participants and their beneficiaries; and
  • defray reasonable expenses of administering the plan, and
  • with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use,
  • by diversifying the investments so as to minimize the risk of large losses, unless clearly prudent not to do so,
  • in accordance with the documents and instruments governing the plan.

Please see a comparison of fiduciary responsibilities below.

Comparison of Fiduciary Roles




Recommend Plan Investment Options
Select Plan Investment Options
Monitor Plan Investment Options
Replace Plan Investment Options
Provide Participant Investment Options meeting ERISA 404(c) Requirements
Responsible for ERISA 404(a) "Prudent Man Rule"
Oversee Plan Compliance with ERISA
Avoid Prohibited Transactions
Responsible for Maintaining Plan Document
Responsible for ERISA 404(a)(5) Compliance Notices
Responsible for Annual Plan Notices
Responsible for ERISA(c) Compliance Notes
Responsible for Investment Comparative Chart
Provide Third Party Fee Benchmarking
Provide Complete Fiduciary Assessment of the Plan
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