Not-for-Profit Plan Sponsors Adopting Prudent Processes

Not-for-profit plan sponsors show disciplined plan management processes, like conducting a formal review of their plan options and services, according to the first Not-for-Profit Plan Sponsor Insights Survey by TIAA.

Many say they will conduct formal reviews of their administrative fees (39%), investment menu (39%), investment fees (38%) or plan design (34%) during the next year. These percentages are highest for not-for-profit hospital plan sponsors.

Sixty-five percent of plan sponsors have an investment policy statement (IPS) in place to guide their investment monitoring and selection process, and 86% report having a plan adviser. TIAA says these strong processes may help explain why fiduciary concerns rank below worries about employee retirement readiness. 

Still, 38% of all not-for-profit plan sponsors—including 47% of private K-12 plan sponsors—worry about meeting responsibilities as a plan fiduciary. Thirty-one percent are concerned about the impact of the Department of Labor (DOL) rule, and that number increases to 46% for higher education institutions. In addition, 24% worry about criticism regarding plan administrative and investment fees.

An executive summary of the TIAA survey findings can be read here.