For retirement Plan Sponsors and committees, fiduciary oversight is not a one-time exercise. Rather, it is an ongoing responsibility that requires documentation and regular review. As regulatory expectations continue to rise and participant needs grow more complex, following a structured fiduciary checklist can help reduce risk and improve outcomes.
The following retirement plan best practices checklist include the monitoring and active management of core areas that should be reviewed at least annually, or more frequently where plan issues require, to maintain strong governance and demonstrate a rigorous fiduciary process.
Effective fiduciary oversight begins with governance. Retirement Plan Sponsors and committees should annually review and update their committee charter to confirm roles, responsibilities, meeting frequency, and decision-making procedures. Meeting minutes need to capture not only decisions made, but also the rationale behind those decisions and the materials reviewed. Well-maintained documentation remains one of the strongest fiduciary defenses.
Investment oversight remains a central fiduciary duty. Retirement Plan Sponsors and committees should reaffirm their Investment Policy Statement (IPS) annually, ensuring benchmarks, evaluation criteria, and watch-list procedures remain appropriate. A comprehensive fund lineup review should assess performance, risk characteristics, style consistency, and each investment’s role within the retirement plan. Clear documentation needs to support the inclusion or removal of any investment options.
Special attention should be paid to the Qualified Default Investment Alternative (QDIA), particularly with target-date investments. Glidepath suitability, demographic alignment, and peer benchmarking needs to be evaluated. Any specialty options, such as stable value funds or managed accounts, should be reviewed for consistency with the retirement plan’s IPS.
Retirement Plan Sponsors and committees also need to review service provider contracts and service-level agreements annually to confirm services delivered match contractual obligations. Evaluating fee reasonableness, technology capabilities, and cybersecurity practices is key for recordkeeping, investment management, and advisory services. Any revenue-sharing arrangements must be monitored, offset appropriately, and fully disclosed. Indirect fees, such as sub-transfer agency fees, need to be clearly understood and documented.
Strong fiduciary oversight increasingly emphasizes outcomes, not just regulatory compliance. Retirement Plan Sponsors and committees should review participation and deferral rates across demographics, evaluating the effectiveness of auto-enrollment and auto-escalation features. Plan design elements, such as Roth utilization, match formulas, loan policies, and hardship withdrawals, need to be reviewed for alignment with participant behavior and retirement readiness goals. Evaluating participant data, including average deferral rates, account balances, diversification, and projected retirement readiness, can provide valuable insight into overall retirement plan effectiveness.
With the continued rollout of SECURE Act 2.0, fiduciary oversight now includes confirming that legislative changes are operationally implemented and properly documented. Changes, such as to auto-enrollment rules, long-term part-time eligibility, and Roth catch-up treatment, should be implemented and reflected in updated retirement plan documents.
Cybersecurity oversight is now a fiduciary expectation. Retirement Plan Sponsors and committees should review vendor SOC (System and Organizational Control) reports, cybersecurity policies, incident response plans, and training protocols annually. Operational reviews should address common risk areas including late contributions, eligibility errors, loan administration, and compensation definitions.
Lastly, retirement Plan Sponsors and committees should maintain a comprehensive fiduciary file that includes meeting minutes, IPS documentation, investment and fee reviews, provider contracts, training records, notices, and compliance testing results. A well-organized fiduciary file not only supports audit readiness, it also reinforces disciplined governance.
A structured checklist that incorporates each of these oversight areas helps Retirement Plan Sponsors and committees demonstrate a prudent fiduciary process, manage regulatory risk, and remain focused on improving participant outcomes. As regulatory requirements continue to evolve, disciplined governance and documentation remain among the most effective fiduciary tools.
For questions regarding fiduciary oversight and these best practices, please contact your Sentinel Group representative.
Any regulatory, legal, or compliance information provided by Sentinel Group is for general informational purposes only and should not be construed as legal advice.
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