Broker Check

Your Fiduciary Role

Six out of 10 baby boomers are unprepared for retirement, and face an average shortfall of $500,000?1 In fact 58% of Americans have made no attempt whatsoever at figuring out how much they’ll need for retirement.*

According to the DOL, a fiduciary is any person who exercises discretionary authority or control over the management of the plan or disposition of plan assets, provides investment advice to the plan for a fee (or has the authority to do so), or possesses any discretionary authority over the administration of the plan. As a Fiduciary you have four important duties:

  1. The duty to act prudently.
    Fiduciaries must discharge their duties prudently. In order to satisfy this duty, a fiduciary must use the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of a like enterprise with like aims.

  2. The duty to act with loyalty and for the exclusive benefit of participants and beneficiaries.
    Fiduciaries must discharge their duties solely in the interest of and for the exclusive purpose of providing benefits to participants and their beneficiaries and defraying reasonable expenses of administering the plan.

  3. The duty to diversify plan assets.
    Fiduciaries must diversify plan assets so as to minimize the risk of large losses, unless it is clearly prudent not to do so under the circumstances. Note: Each plan investment should be considered as part of the plan’s entire portfolio.

  4. The duty to act in accordance with the plan’s governing documents and instruments.
    Fiduciaries must discharge their duties in accordance with the documents and instruments governing the plan to the extent that they are consistent with ERISA.

1“Retirement Confidence Survey,” EBRI March 2013. *TD Ameritrade, “Boomers and Retirement,” December 2012.