PLANADVISER - March/April 2018 - 44
practice management
Taking on Discretion
A
s plan sponsors feel more concerned about meeting all
of their fiduciary responsibilities, they will increasingly
turn to advisers and others who can assume
3(38) fiduciary status, believes Melissa Cowan, executive
director at Morgan Stanley in New York City.
Offering 3(38) services means taking on an investmentmanagement
role and having fiduciary discretion in making
decisions about plan investments. " Upmarket, among larger
plans, they are probably hearing about it from their ERISA
[Employee Retirement Income Security Act] attorneys, who
are saying, 'Why not do this? It's going to reduce your risk,' "
Cowan says. " At the smaller end of the market, plan sponsors
are juggling so many things. They may not understand
the 3(38) role off the bat, but when it's explained to them
that it will reduce their risk and take a lot of the work off
their shoulders, they understand. "
Considerable opportunities exist in both markets, as well
as in between, because the vast majority of plans do not
yet work with a 3(38) adviser, according to the 2017 PLANSPONSOR
Defined Contribution (DC) Survey. Just 17.9% utilize
one-most typically plans in the $10 million to $20 million
Should you offer 3(38) fiduciary services or outsource the role?
asset range (22.0%) and in the $5 million to $10 million plan
market (21.1%). Plans with less than $1 million in assets use
3(38) advisers least often (10.9%).
Advisers working in the micro- and small-plan segments
of the defined contribution market oftentimes work only
with a handful of employer-sponsored retirement plans,
with the bulk of their business in traditional wealth
management, says Jessica Sclafani, director, retirement at
researcher Cerulli Associates in Boston. " Cerulli does not
anticipate these advisers will rush to offer themselves as
an ERISA 3(38) investment manager co-fiduciary. Most of
their plan sponsor clients aren't even aware of what a 3(38)
fiduciary is, and, furthermore, some [advisers] may not be
permitted to act as an ERISA 3(38) fiduciary by their broker/
dealer [B/D], " she says.
Some plan advisers who want to offer 3(38) services are
affiliated with firms that have these capabilities in-house.
" If you're talking about mid-tier advisory firms such as
Lockton or CAPTRUST, they already have the capacity to do
the 3(38) work from the home office, " Sclafani says. Wirehouses
also have the home-office resources to do invest44
| planadviser.com march-april 2018
Art by Jing Wei
http://www.planadviser.com
PLANADVISER - March/April 2018
Table of Contents for the Digital Edition of PLANADVISER - March/April 2018
2018 PLANSPONSOR Retirement Plan Adviser of the Year
Battling the Elements
Taking on Discretion
A QDIA In Transition
Working Down-Market
Retirement Income Options
2018 SEC Examination Priorities
Enforcement of the DOL Rule
Duty to Investigate
PLANADVISER - March/April 2018 - C1
PLANADVISER - March/April 2018 - FC1
PLANADVISER - March/April 2018 - FC2
PLANADVISER - March/April 2018 - C2
PLANADVISER - March/April 2018 - 1
PLANADVISER - March/April 2018 - 2
PLANADVISER - March/April 2018 - 3
PLANADVISER - March/April 2018 - 4
PLANADVISER - March/April 2018 - 5
PLANADVISER - March/April 2018 - 6
PLANADVISER - March/April 2018 - 7
PLANADVISER - March/April 2018 - 8
PLANADVISER - March/April 2018 - 9
PLANADVISER - March/April 2018 - 10
PLANADVISER - March/April 2018 - 11
PLANADVISER - March/April 2018 - 12
PLANADVISER - March/April 2018 - 13
PLANADVISER - March/April 2018 - 14
PLANADVISER - March/April 2018 - 15
PLANADVISER - March/April 2018 - 16
PLANADVISER - March/April 2018 - 17
PLANADVISER - March/April 2018 - 18
PLANADVISER - March/April 2018 - 19
PLANADVISER - March/April 2018 - 20
PLANADVISER - March/April 2018 - 21
PLANADVISER - March/April 2018 - 22
PLANADVISER - March/April 2018 - 23
PLANADVISER - March/April 2018 - 2018 PLANSPONSOR Retirement Plan Adviser of the Year
PLANADVISER - March/April 2018 - 25
PLANADVISER - March/April 2018 - 26
PLANADVISER - March/April 2018 - 27
PLANADVISER - March/April 2018 - 28
PLANADVISER - March/April 2018 - 29
PLANADVISER - March/April 2018 - 30
PLANADVISER - March/April 2018 - 31
PLANADVISER - March/April 2018 - 32
PLANADVISER - March/April 2018 - 33
PLANADVISER - March/April 2018 - 34
PLANADVISER - March/April 2018 - 35
PLANADVISER - March/April 2018 - 36
PLANADVISER - March/April 2018 - 37
PLANADVISER - March/April 2018 - 38
PLANADVISER - March/April 2018 - 39
PLANADVISER - March/April 2018 - Battling the Elements
PLANADVISER - March/April 2018 - 41
PLANADVISER - March/April 2018 - 42
PLANADVISER - March/April 2018 - 43
PLANADVISER - March/April 2018 - Taking on Discretion
PLANADVISER - March/April 2018 - 45
PLANADVISER - March/April 2018 - 46
PLANADVISER - March/April 2018 - 47
PLANADVISER - March/April 2018 - A QDIA In Transition
PLANADVISER - March/April 2018 - 49
PLANADVISER - March/April 2018 - Working Down-Market
PLANADVISER - March/April 2018 - 51
PLANADVISER - March/April 2018 - Retirement Income Options
PLANADVISER - March/April 2018 - 53
PLANADVISER - March/April 2018 - 2018 SEC Examination Priorities
PLANADVISER - March/April 2018 - Enforcement of the DOL Rule
PLANADVISER - March/April 2018 - Duty to Investigate
PLANADVISER - March/April 2018 - C3
PLANADVISER - March/April 2018 - C4
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