The Department of Labor has stated that documentation, such as an Investment Policy Statement, is key to demonstrating that plan fiduciaries are following their Employee Retirement Income Security Act of 1974 (ERISA) responsibilities.
A retirement plan’s investment policy sets the goals and objectives of the plan trust. It is a written reference regarding the types of investment vehicles, investment objectives, monitoring processes, diversification interests, and other plan investment management areas.
Selecting and monitoring investments is an important fiduciary function. ERISA does not set forth the content of a particular Investment Policy, only that a Plan must have one and it should be in writing.
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