Today, I’d like to CONCLUDE OUR VIDEO SERIES on the topic of “Is My Yeshiva’s Retirement Plan Up to Standard?
Now let’s discuss your employer’s Fiduciary obligation: Ultimately, the board and leadership at the yeshiva are responsible for meeting their fiduciary obligation to the school’s employees. A fiduciary standard is the duty to act solely in the best interest of plan participants and beneficiaries. This includes making decisions with prudence, monitoring investments and fees regularly, and ensuring the plan is operated according to its governing documents. This also involves selecting and overseeing service providers carefully, avoiding conflicts of interest, having regular education meetings, and documenting all major decisions. They are also responsible for maintaining compliance with ERISA, including eligibility rules, contributions, disclosures, and annual filings. Ultimately, the school leadership’s obligation is to protect participants’ retirement assets and ensure the plan is managed responsibly, transparently, and in line with regulatory standards.
So, What can you do? While there seem to be a few red flags in the way your plan is being handled, unfortunately, without having your specific plan information it is impossible for me to accurately assess all the issues.
However, the process of evaluating the quality of your plan is simple. Here is what I suggest to all viewers who are in this conundrum:
1) Make your voice heard: Reach out to the person at your yeshiva who oversees the plan. This is likely someone with one of the following titles: Executive director, CFO, Head of Finance, or Human Resources. Express your concerns and see what they say.
2) Request a review: If they fumble or are not sure what’s going on, don’t panic. Suggest they have an independent third party review their plan. When I review 401(k) or 403(b) plans, I don’t charge a fee, and I try to make it as seamless as possible. Other advisors have different processes for handling this type of inquiry or analysis.
3) What to expect from a review: A review involves analyzing several critical pieces of information and offering a succinct report on the plan that points out concerns (if there are any), practical suggestions for improving the plan for employees, and ensuring that the employer is fulfilling their fiduciary obligation.
A properly administered retirement plan for yeshivas should include annual benchmarking, educational meetings, an open architecture investment lineup, and three distinct parties handling the management of the plan. When administered correctly, a 401(k)/403(b) can be an invaluable resource to yeshiva employees.
Remember, Rebbeim, morahs, and teachers in yeshivas provide some of the most important work in any frum community. They are educating and inspiring our children to live a life of Torah. They deserve to be compensated appropriately, which includes offering a retirement plan that provides the resources that will lead them to a successful financial future.