SERVICES
| Fiduciary |
|---|
| Responsible for Invesment Lineup |
| Provided by iQ401k |
| Third-Party Administrator |
|---|
| Responsible for Administration & Form Filings |
| Provided by Vanguard/Farmer & Betts |
| Recordkeeper |
|---|
| Responsible for Managing & Tracking Plan Participant Activities |
| Provided by Vanguard |
| Custodian |
|---|
| Responsible for Custodying Plan Assets |
| Provided by Ascensus |
There are four different components to consider when establishing and maintaining a workplace retirement plan:
We can act as your Plan’s ERISA 3(38) or ERISA 3(21) Fiduciary. Under ERISA 3(38) Fiduciary capacity, we will have discretionary authority over the investments of the Plan assets. This authority may include:
Create and maintain Investment Policy Statement
Create investment lineup
Add, remove, or replace investments
Create asset allocation models
Add, remove, or replace asset allocation models
Make investment recommendations for plan participants
Others Services
In addition to the aforementioned services, we also provide the following services:
Our involvement under ERISA 3(21) Fiduciary capacity will vary depending on the terms the Plan Sponsor and we have agreed upon. There are three levels of ERISA 3(21) involvement in a Plan: Limited Scope, Full Scope, and Specific Scope.
ERISA 3(38) vs ERISA 3(21)
A “Limited Scope” fiduciary is where we are hired for a specific purpose. Responsibilities may include monitoring and replacing recommended investments, and advising on drafting and following an Investment Policy Statement. Limited Scope is the more common option, and what we currently provide for most Plans.
A “Full Scope” fiduciary is where we effectively take over the role of the ultimate fiduciary in regards to the operation and administration of the Plan as well as the investments of Plan assets. Responsibilities may include hiring and monitoring other Plan service providers, including Limited Scope fiduciaries. Full Scope fiduciaries are less common. If we operate under the Full Scope, additional fees will apply.
“Specific Scope” option falls somewhere between Limited Scope and Full Scope, generally accepting a specific assignment by assuming discretion over a specific aspect of the Plan’s operations. If we operate under the Specific Scope, additional fees will apply.
| ERISA 3(38) | ERISA 3(21) | |
|---|---|---|
| Role | Investment Manager | Investment Advisor |
| Risk Protection | High | Moderate |
| Fiduciary Responsibility | Shared | Plan Sponsor |
| Investment Lineup | Makes the Actual Decisions | Makes Recommendations |
| Monitoring | Yes | Yes |
| Research & Analysis | Yes | Yes |
| Co-Fiduciary Meetings | Yes | Yes |
While the ERISA 3(21) fiduciary may share fiduciary status, the Plan Sponsor, through its board of directors and those whom it delegates, retains the ultimate decision-making authority.
Other three components – Recordkeeping, Administrator, and Custodial services can be provided under a “Bundled” or an “Unbundled” package. Recordkeeping, Administrator, and Custodial services are provided by respective third-parties. Vanguard Retirement Plan Access™ (VRPA) offers a “Bundled” and an “Unbundled” package. The Bundled package includes Recordkeeping, Administrator, and Custodial services. The Unbundled package only offers Recordkeeping and Custodial services. Under the Unbundled package, Administrator services can be provided by an outside company. The Unbundled package is the suitable choice for a retirement plan with a Defined Benefit Plan (or Cash Balance Plan). We currently partner with Farmer & Betts to provide Administrator services for Defined Benefit Plans or Cash Balance Plans.
