The Retirement Income Consortium: Practices for Providing Retirement Income to Participants in Defined Contribution Plans
Benefits and executive compensation partner Fred Reish authored a white paper covering the Retirement Income Consortium’s handbook titled “Prudent Practices for Retirement Income Solutions.” In it, he discusses the 10 practices described in the handbook and how they support compliance with the requirements the Employee Retirement Income Security Act imposes on plan sponsors, fiduciaries and advisors.
Reish explains that the handbook defines a fiduciary standard of excellence for the selection and monitoring of retirement income solutions for tax-qualified defined contribution retirement plans, such as 401(k) plans. The handbook’s objective is to help plan sponsors and advisors prudently evaluate, select and oversee retirement income solutions. Further, Reish notes that the 10 practices outlined in the handbook define a process that includes both legal requirements and best practices for such a process.
Reish also details best practices — actions and decisions that go beyond what the law requires — that plan sponsors and fiduciaries may choose to apply. Finally, he covers the non-fiduciary role of plan sponsors when they act in their capacity as “settlors” of their plans and how plan sponsors can help implement retirement income solutions while acting in that non-fiduciary capacity.
Overall, Reish states that the adoption of retirement income solutions is best achieved through a collaborative effort by plan sponsors and the plan fiduciaries, supported by consultation with, and advice from, the plan’s advisors.
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