Mesirow Financial acts as investment co-fiduciary for investments on its Elite List, and protecting the plan sponsor from third-party lawsuits arising from issues regarding investment selection and monitoring, provided the sponsor selects funds from that list.
Transamerica Retirement Services’ President Stig Nybo told PLANADVISER that he thinks the 3(21) service is quickly becoming “a must-have” for providers in the industry. “There is a need for advice at a plan level with regards to selecting investments,” he said.
There will be advisers who need this to augment their services because they are prevented from serving in a fiduciary capacity and there will be some plan sponsors who prefer to have the bigger name, Nybo said.
Transamerica says its 3(21) fiduciary service will:
- Give the plan sponsor the best resources available to make the best decisions possible as the plan’s fiduciary
- Give the financial adviser tools to assist in select the plan’s line-up
- Allow the sponsor to mitigate fiduciary risk.
Additionally, Transamerica says the benefits of this service for advisers include:
- The financial adviser remains the key contact for the client
- The financial adviser can help the client to mitigate fiduciary risk
- The financial adviser chooses his or her level of involvement. (The adviser can recommend a line-up to the sponsor using Mesirow's Elite List or Meisrow can recommend one of three line-ups based on plan demographics.)
The program will be rolled out in the fourth quarter.
The program is part of the company’s growth initiatives, Nybo said. Transamerica is trying to keep growth predictable. Nybo says the company has seen positive growth over the last five years, with sales growth ranging from 11.6% to 34.9%. Transamerica Retirement Services wants “sustainable growth” that “can be replicated,” Nybo commented.
The company has “been very focused on what we consider to be our mission,” he said, explaining that the mission includes: leading the retirement industry in providing best-in-class tools and services, being an innovator in the industry, and being known for its financial strength.