Short Form 5500 helps hide bad plans

Given its age, you’d expect ERISA to be buying a sports car, trying on hipster clothes and generally just trying to recapture the vigor of its youth. While it’s unlikely that the now 40-year-old Employee Retirement Income Security Act will be going bungee-jumping any time soon, ERISA is indeed suffering a bit of a mid-life crisis.

The primary method by which ERISA provides disclosure on 401(k) and other retirement plans is a form called the 5500. As a purveyor of 5500-based market intelligence, I can tell you that ERISA has recently experienced a loss of identity and purpose. Although one of the initial goals of ERISA was to provide plan participants with a window into how their money is being spent, the new “Short Form” 5500 has had the opposite effect.