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Fiduciary, n.
A duty to act for someone else’s
benefit, while subordinating
one’s personal interests
to that of the other person. The
highest standard of duty implied
by law.
--- Black’s
Law Dictionary
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| Employee Fiduciary
operates on these simple principles: |
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1) The
best way to maximize employees' retirement
accounts is to control costs. |
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2) 401(k)
providers should assume fiduciary responsibility
and accountability for the products they sell. |
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3) 401(k)
providers cannot impart unbiased investment
advice while receiving compensation from mutual
funds or other investment
companies for steering
clients into proprietary
investments. |
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4) To
ensure independence, 401(k) providers must
disclose their sources
of income.
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5) To
ensure efficiency, 401(k) plans should disclose
all
total costs--including
record-keeping fees, investment
fees, commissions, and trading
costs--on participant
statements. |
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6) To
ensure performance, 401(k) providers should provide
each participant with an
independent, third-party
review of investment
performance. |
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7) 401(k)
providers should design plans that automatically
adjust to help employees
safeguard their retirement accounts with minimal
employee effort. |
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| 8) A
401(k) plan should be effortless for employers
to set up and use. |
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