How well does your current Target Date Fund series meet DOL’s selection criteria and best practices? How well does your TDF series meet your employee’s needs, risk tolerance and demographics? Following a thorough process for selecting a Target Date Fund series will help your employees minimize or eliminate “Misfit Risk.” Misfit risk is prominent among retirement plans and exists when the TDF series investment risk is either too aggressive or not aggressive enough to meet an employee’s needs and risk tolerance.
As a 3(38) investment fiduciary, we can work with any TDF solution in the marketplace. However, to help sponsors and employees avoid misfit risk, we also are able to offer low-cost, custom-built Target Date Funds with an easy best fit process for employees to avoid misfit risk.
Our comprehensive Target Date Fund series analysis evaluates the quality of the overall series as well as the underlying investments to make sure the series doesn’t have any inferior underlying investments.
Our TDF analysis includes:
Suitability analysis (funding adequacy, participant tendencies, glidepath risk postures),
Qualitative considerations (active vs passive, single manager or multi-manager, asset class coverage)
Performance analysis (risk / return comparisons, investment expenses, underlying investment performance)