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Options for small plans to invest like the big pension funds

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Joe Nunes:

Great article for plan sponsors of smaller plans to read. But what is absent in the discussion is the sophistication on the members of the plan sponsor’s pension committee.

Smaller pension plans are often sponsored by smaller companies and the pension committee, if there is one, is staffed with well intended non-investment experts.

Sometimes committees get ‘sold’ products they don’t understand and the risks for which they cannot afford. Sometimes the upside hides the unwanted risk and sometimes the downside costs a big increase in unexpected contributions.

The pension committee needs to make sure they understand each investment product and its risks, not just its ‘expected returns’.

Wednesday, January 03 at 2:40 pm | Reply