We’re guided by a long-term vision as well. “Financial freedom for everyone” has always been our watchword. Even as we were rolling out investment advice in our first client 401(k), we dreamed of expanding the benefits of our services beyond retirement plans. With that in mind we’re very excited to announce a groundbreaking new program that makes professional, fiduciary investment advice truly available to anyone and everyone: the GuidedChoice IRA.
“A Long Time Ago…”
But first, a little history. We started our journey working with qualified retirement plans because they offered advantages of connectivity, communication, and plan design. These have helped us bring personalized, professional advice to millions of plan participants. Plan sponsors also share a burden of fiduciary responsibility that makes doing the right thing for participants not just a good deed but also a legal requirement.
Many working Americans, however, simply don’t have access to a plan, either because their employers don’t offer them, or because they’re among the growing ranks of the self-employed. Some leave their jobs, voluntarily or otherwise, triggering a decision about what to do with a frozen defined contribution account. And some are participating in a retirement plan, but want a way to save additional retirement money.
Hyperdrive for the IRA
They can always open a traditional IRA. But as we see it, to be truly effective as a retirement planning tool, IRAs should be more than simply tax-deferred investment vehicles. They should provide two more elements: investment help and fiduciary oversight.
The first part is pretty clear. People who use IRAs would benefit from the same kind of personalized, professional, independent investment advice that’s rapidly gaining acceptance among progressive 401(k) plan sponsors. Likewise, default enrollment in a managed portfolio is still considered a pretty advanced feature in retirement plans. In our IRA offering it’s automatic.
You Are Not Alone
The second critical element is perhaps less obvious: fiduciary responsibility. It’s taken for granted in the plan world (at least until your account gets frozen), but until now entirely absent from IRAs. We believe that if you take care of someone’s retirement money you have a responsibility to act solely in their interest, period. We gladly accept that burden on behalf of IRA investors. We hope our industry will too. And because we can deliver our IRA functionality across a range of partner platforms, we’re ready to help.
Why is this a big deal? We’re all aware of the long-term shift toward individual responsibility for retirement from traditional pensions to 401(k) or other self-directed retirement plan and IRAs. We’re also sadly familiar with the way many people actually feel when they receive this gift of responsibility: “uh-oh, we’re on our own now.”
It’s our mission to make that feeling go away. Our goal is to help investors in self-directed accounts get easy, affordable access to professional management, fiduciary oversight, and unbiased advice. Bringing managed accounts to the IRA market marks a big step toward achieving it.