Conversation Toolkit

Making QDIA selections

Topic overview

When plan participants fail to self-direct their investments, most defined contribution plans specify a default investment for them.

If plan sponsors prudently select qualified default investment alternatives (QDIAs) for their plans and follow notice and disclosure requirements, the DOL protects them from investment performance liability.

This toolkit helps you guide your clients through the QDIA selection process to minimize their risk.

Is this relevant to my clients?

Individuals could benefit from these tools if they:

  • Maintain 401(k) and other defined contribution retirement plans that allow self-direction of investments
  • Use an auto enrollment safe harbor plan designation or nonqualified default investments
  • Lack a prudent, documented process for selecting and monitoring QDIAs
  • Do not maintain plans at this time but are considering establishing self-directed workplace retirement plans

How to use your toolkit

  1. Schedule client meetings to discuss this opportunity.
  2. Email the Pre-Meeting Overview to your clients to set their expectations.
  3. Print out the Meeting Worksheet and review it together.

Disclosures

This material is for educational purposes only. It cannot be used for the purposes of avoiding penalties and taxes. Columbia Threadneedle Investments does not provide tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.