More ‘qualified default investment alternatives’ in retirement plans: ERISA Advisory Council
The Council issued recommendations to the DOL to create a “tips document” to help fiduciaries in choosing QDIAs with lifetime income options, improve QDIA guidance, and provide for QDIAs in IRAs.
By Lynn Cavanaugh |
December 16, 2024 at 02:26 PM
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After studying the effectiveness of qualified default investment alternatives (QDIAs) in retirement plans, the ERISA Advisory Council (EAC) has made recommendations to the Department of Labor – and sent three proposals to the DOL – regarding QDIAs. The EAC recommendations include creating a “tips document” to help fiduciaries in choosing QDIAs with lifetime income options, improving QDIA guidance, and providing for QDIAs in IRAs.
QDIAs are the default investment in a defined contribution plan, and they becoming increasingly important because of the growing role of auto-enrollment which automatically places participants in QDIAs. They have been effective in helping 401(k) participants achieve age-appropriate investment portfolios, however, no QDIA exists in IRAs.
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