Act solely in the interest of plan participants — This may seem obvious, but you cannot prioritize your board, president, or local community interests over the plan participants. Act prudently — The duty to act prudently requires expertise in areas such as investment. Lacking that expertise, a fiduciary should hire someone with that professional knowledge. Fiduciaries are responsible for a decision process, not investment results. The process used to make decisions must be documented to show fiduciaries acted prudently.  Capture more detail than you typically would when documenting an employee benefits-related decision as a fiduciary, . You do not just say, “The retirement plan committee reviewed the investment menu and the performance over the last six months and discussion ensued.” Instead, say something like, “There was a discussion about fund ABC, which almost but not quite met the watch list criteria that we set up in the investment policy statement and the committee decided to p

Active vs. Passive investing styles is an age-old debate in the investing world. Investment managers on either side tend to be steadfast advocates of the merits of their approach. Active managers seek to exploit market inefficiencies by relying on analytical research, forecasts, and their own judgement and experience to decide which securities to buy, hold, and sell. Passive investing involves simply tracking an index to avoid the management fees and trading costs that can be a drag on performance by adhering to a buy-and-hold strategy. However, no one strategy always triumphs. It cannot be ignored that both investing strategies have positive attributes and have helped define the historical and current investing trends we have witnessed in the retirement marketplace. As a retirement advisory firm, HANYS Benefit Services (HBS) consults with fiduciaries to help them design a fund menu that will utilize the most appropriate investment style per asset class, customized for their Plan’s dem