Page 27 - DCAC November 2023 Files

empower.com

Investment selection
Empower representatives also use a series of questions
to determine if assistance with fund selection should
be provided through the point-in-time process or
whether professional assistance through target date
funds or a managed account service is warranted.
Answers to each of the questions may or may not lead
to a follow-up question.

The first question a representative asks is, “Do you want
to manage and make your own investment decisions?”
If a participant answers “yes” yet indicates they would like
help with such decisions, they are offered point-in-time
investment advice to help with fund selection at no Participants who are further from retirement generally
additional cost to them. don’t need sophisticated investment solutions. As a result,
target date funds are often recommended to younger
Point-in-time investment advice allows the participant to
work with a representative to put together an investment people with simpler financial lives. Conversely, as people
allocation that fits their situation. These investment grow older and their financial situations become more
allocations are determined by independent financial complicated, the less likely it becomes that an off-the-shelf
experts from either Morningstar Investment Management investment product will be right for them.
LLC or Financial Engines Advisors L.L.C. and do not include The closer a participant gets to retirement, the more likely
ongoing account management and monitoring. they may benefit from speaking with an investment
professional. In such a case, a managed account
The recommendation to consider a form of professional
investment assistance is based on a matrix of age, complexity service could be recommended if one is available in the
of financial situation and available options. Representatives participant’s plan.
ask follow-up questions about the participant’s specific There is no guarantee provided by any party that
financial situation, and whether or not they are willing to participation in any of the advisory services will result
pay for investing expertise, to determine if this option in a profit.
may be right for them.

Fee comparison tool

It’s important that we help people compare the expenses to provide the fee information, the representative will
that go along with the options they are considering. If a use appropriate industry benchmarks to establish
participant is paying fees in a prior employer’s plan, an fee comparisons. Provided by Fiduciary Decisions
Empower representative will ask them to provide their and Morningstar, these benchmarks can also allow a
most recent fee disclosure statement (such as a representative to present a side-by-side comparison
404a-5 fee disclosure) and will explain the importance that can inform the responses used to populate the
of providing the fees so that their current fees can be methodology tool.
evaluated against other options. If a participant is unable

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