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Voluntary Savings Plans (401k,1165e, etc.)

Voluntary savings plans require special attention, since each participant makes his/her own investment decisions. Participants must be provided with optimum conditions for making adequate and informed decisions. This means relying on sufficient practical information, sufficient investment options, sufficiently agile fund switching and an appropriate environment for independent decision making.

It is the duty of the plan sponsor to provide these conditions for plans under ERISA's Section 404c. Otherwise, the plan sponsor may be liable for investment decisions made by plan participants.

At CONSULTIVA we've developed procedures for establishing and servicing such plans. The focus is twofold: assist fiduciaries in complying with their obligations, while assisting plan participants in making effective and informed investment decisions.

A written investment policy helps fiduciaries monitor education and investment processes. It also allows fiduciaries to establish and articulate investment objectives and benchmarks for the various investment options, which can then be monitored on a regular basis.

Our experience indicates that financial education in the participant's native culture and language is vital to a plan's success. Educational materials, as well as group orientations should support a decision making process that each participant can understand and implement.