“I’ve often said that fiduciary is not just a noun, it’s both a noun and a verb. It’s easy to be a fiduciary, but it’s hard to be a good one.”
Teaching plan committees and sponsors how to be a good one is where Josh Itzoe’s “heart, mission, and passion are starting to go” and the reason for his recent multimedia release of a book, website, and podcast dedicated to the subject.
The Partner and Chief Strategy Officer with Maryland-based Greenspring Advisors has rounded up industry A-listers to help—including Fred Reish, Riskalyze’s Aaron Klein, Vestwell’s Aaron Schumm, Stadion’s Todd Lacey, and Michael Kitces, among others.
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“People have heard the word fiduciary,” Itzoe explains. “Now, do they understand what that means and what it takes to be an effective fiduciary? I think we’re still in the early innings. What really matters is if you’re doing what you need to do—as a committee member, advisor or recordkeeper—to evaluate best practices that drive outcomes for participants. The right decisions are usually the hardest.”
Surprisingly, part of the issue involves the industry’s current love affair with financial wellness, which he emphasizes is incredibly important but has “consumed the idea of fiduciary.”
“There’s a lot of fatigue, quite frankly, in the marketplace from plan sponsors around fiduciary, funds and fees. That focus is shifting, and everybody wants to talk about wellness. I think that’s important, but I would still say that that fiduciary decisionmakers make 95% to 98% percent of all the decisions that are going to determine whether participants have a successful retirement.”
His fear, he says, is that more plan sponsors are starting to gloss over their fiduciary responsibilities because financial wellness is sexier and much more interesting.
“Litigation is starting to crank up again,” Itzoe warns. “I don’t think that’s going to slow down. The book, website, and fiduciary training I’ve created are meant to help fiduciaries sharpen the saw so they can do a much better job for the people who depend on them.”
The book, The Fiduciary Formula: 6 Essential Elements to Create the Perfect Corporate Retirement Plan, is a follow-up (of sorts) to Fixing the 401(k), which he wrote in 2008.
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“A lot of that book was more theory and a treatise of where I thought the industry should go. It just so happened that a lot of the things I wrote about back then came to fruition—whether it was around fee-transparency, plan design, or the shift to passive strategies.
The time is now, he adds, to write a handbook of what he’s learned over the years about creating great retirement plans. Originally designed for plan sponsors, it’s great for practitioners as well.
It’s a more researched and in-depth book, he says, that presents an easy-to-understand formula with six key elements that make “the complex simple for fiduciaries, professionals and committee members across the board.
“I wouldn’t say I’m a great original thinker, but I do think there are things that become a little bit clearer to me perhaps quicker than other folks in the industry,” Itzoe concludes. “When I see those things, I put them together in a narrative and message in a way that people can understand. I feel like I can influence our industry by taking the ideas, best practices, research and philosophies we’ve successfully used over the years and package that up to really help advisors and industry professionals learn, grow and improve.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
