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A Superior Collective Investment Trust Onboarding Experience.
A Superior Collective Investment Trust Onboarding Experience.
For years, a question of fundamental fairness has shaped the debate around Collective Investment Trusts (CITs) in 403(b) retirement plans: Why should the type of plan a worker participates in determine which investment vehicles are available to them?
Former Assistant Secretary of Labor, Lisa M. Gomez, who led the Department of Labor’s Employee Benefits Security Administration (EBSA), brings a clear-eyed perspective to this question in a new article for PlanSponsor. Drawing on her extensive regulatory experience and longstanding commitment to retirement security, Gomez examines how CITs are regulated, the protections that accompany them, and why plan decisionmakers for 403(b)s eligible to access CITs under proposed legislation should have the same opportunity to evaluate these vehicles through the careful, informed process already required for other investment options.
Her argument is grounded in a principle we share: good policy should reflect how investment vehicles, markets, and regulatory safeguards have actually evolved. As Gomez writes, the goal is not to favor one vehicle over another, but to ensure that plan fiduciaries have the full set of tools available to make well-informed decisions on behalf of their participants.
We encourage anyone involved in the governance of retirement plans to read the full article. The case for expanding access to CITs in 403(b) plans has always been about something larger than any single investment structure. It is about ensuring that workers saving for retirement through 403(b) plans — educators, nonprofit employees, clergy, and others — have a fair opportunity to benefit from the same range of cost-effective, well-regulated options available to participants in 401(k) and other defined contribution plans.
When decision-makers have more tools at their disposal, and when those tools are backed by strong regulatory safeguards, the people who stand to benefit most are the workers and families counting on those plans to support a secure retirement.
Read the full article on PlanSponsor
For more on this topic from Great Gray:
Great Gray Trust Company, LLC Collective Investment Funds (“Great Gray Funds”) are bank collective investment funds; they are not mutual funds. Great Gray Trust Company, LLC serves as the Trustee of the Great Gray Funds and maintains ultimate fiduciary authority over the management of, and investments made in, the Great Gray Funds. Great Gray Funds and their units are exempt from registration under the Investment Company Act of 1940 and the Securities Act of 1933, respectively.
Investments in the Great Gray Funds are not bank deposits or obligations of and are not insured or guaranteed by Great Gray Trust Company, LLC, any bank, the FDIC, the Federal Reserve, or any other governmental agency. The Great Gray Funds are commingled investment vehicles, and as such, the values of the underlying investments will rise and fall according to market activity; it is possible to lose money by investing in the Great Gray Funds.
Participation in Collective Investment Trust Funds is limited primarily to qualified retirement plans and certain state or local government plans and is not available to IRAs, health and welfare plans and, in certain cases, Keogh (H.R. 10) plans. Collective Investment Trust Funds may be suitable investments for plan fiduciaries seeking to construct a well-diversified retirement savings program. Investors should consider the investment objectives, risks, charges, and expenses of any pooled investment fund carefully before investing. The Additional Fund Information and Principal Risk Definitions (PRD) contains this and other information about a Collective Investment Trust Fund and is available at www.greatgray.com/cit-fund-info/principal-risk-definitions/ or ask for a free copy by contacting Great Gray Trust Company, LLC at (866) 427-6885.
Great Gray® and Great Gray Trust Company are service marks used in connection with various fiduciary and non-fiduciary services offered by Great Gray Trust Company, LLC.