Portico Wealth’s Free Diagnostic Helps Plan Sponsors (401k/403b) Tackle New 408(b)2 Rules

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Portico Wealth Advisors, a leading Bay Area retirement plan consultancy firm, offers sponsors a complimentary look at the true cost and quality of their retirement plans.

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Our Retirement Plan Diagnostic allows a plan sponsor to ‘peer behind the curtain,’ and gain clarity as to the real cost and quality of their retirement plan.

Portico Wealth Advisors, LLC, a Registered Investment Advisor and retirement plan consultancy firm, has created a complimentary diagnostic to help retirement plan sponsors fulfill their fiduciary duty to their employees.

Companies that sponsor retirement plans, e.g. 401k/Profit Sharing plans, are facing new legislative scrutiny in 2011. Although the implementation of the recently passed fee disclosure rules [408(b)2] has been delayed until January 2012, sponsors are encountering increased pressure to understand both what their participants are paying for their retirement plans as well as what they are getting for what they are paying. Charitable and government entities that sponsor 403b plans are also being forced to comply.

Portico’s proprietary Retirement Plan Diagnostic (http://www.porticowealth.com/plansponsors/our-diagnostic/) is a comprehensive analysis of a company’s retirement plan, touching on over 100 different points that are crucial to ensuring that a firm is meeting its obligation to its employees. This free diagnostic includes an evaluation of the retirement plan document, the Investment Policy Statement (IPS), the quality and cost of the underlying investments, and the total fees being paid. For those companies that are interested, Portico will also conduct a Service Experience Survey that captures feedback directly from the employees.

“Historically, there have been very few true fiduciary consultants in the retirement plan space,” says Jonathan Leidy, Principal at Portico. “This dearth has made it exceedingly difficult
for companies to understand the mechanics of their retirement plans. Our Retirement Plan Diagnostic allows a plan sponsor to ‘peer behind the curtain,’ and gain clarity as to the real cost and quality of their retirement plan.”

As of January 1st, 2012 all retirement plan vendors that charge a plan in excess of $1,000/yr. will be forced to provide a plain English disclosure to the plan sponsor regarding fees. “On the surface, it would seem reasonable to assume that the new fee disclosure requirements will make it easier for plan fiduciaries to understand the cost of their plan,” says Robert Stebbins, Senior Vice President at Pension Specialists, a retirement plan service provider based in California that services approximately $7B in retirement plan assets. “However, it is conceivable that some sponsors may be receiving as many as 5 or 6 of these disclosures at one time, none of which are standardized. Will plan sponsors really know what to do with all of this new information?”

If not, the consequences can be severe. Fiduciary breaches can spawn criminal penalties as well as personal financial responsibility for individual plan fiduciaries. Recently, two very large companies, WalMart and Edison International, have both been found in breach of their responsibilities to their employees, and in turn, are being saddled with significant penalties.

“Fiduciaries need to understand exactly what their plan participants are paying, and whether those costs are reasonable in light of the services being received,” says Stebbins. “Taking a look at your plan regularly is a very smart practice and having the guidance of an expert in this area is critical for most fiduciaries.”

Companies interested in learning more about Portico’s complimentary Retirement Plan Diagnostic or procuring an analysis should visit http://www.porticowealth.com or contact Principal, Jonathan Leidy, at (415) 925-8700.

Larkspur, California-based Portico Wealth Advisors is a Registered Investment Advisor and leading retirement plan consultant. Predominantly serving plans in the $1-50MM spectrum, Portico works with local and national firms to help them improve the cost, quality and structure of their retirement plans.

Pension Specialists, Inc. is a privately-held corporation headquartered in California. PSI provides
comprehensive retirement plan services and cafeteria plan services to over one thousand clients throughout the United States. Clients range in size from one-person sole proprietors to large corporations with thousands of employees. In total, assets in the plans serviced by PSI exceed $7 billion.

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