Morningstar

and NYLIM Retirement, a division of New York Life Investment Management, are offering a new investment advisory service to 401(k) plan sponsors.

Morningstar Associates, a registered investment advisor and independent investment consultant, will assume fiduciary responsibility for companies using Portfolio Complete.

NYLIM Retirement said this is the largest undertaking of any retirement plan provider, as it will be offered to all of NYLIM’s 1,500 plan sponsors and new clients. NYLIM also said this is the first time a 401(k) plan provider has offered Morningstar’s investment counseling and fiduciary services to its entire client base.

"We are excited to offer the outstanding capabilities and fiduciary support that only a company of Morningstar’s stature can provide," said Barry Schub, senior managing director of NYLIM Retirement Plan Services. "Given the increasing focus on defined contribution plan investments, NYLIM feels the time is right to offer its plan sponsors a fundamentally different type of investment support."

NYLIM will begin offering the new service in the fall.

Citistreet, a joint venture between Citigroup and State Street Corp., began offering a similar service in June [see MFMN 6/10/02] by offering plan participants investment advice from Financial Engines Advisors. The company said its offering marked the first time a plan provider made advice directly available to participants.

Citistreet noted at the time that the new advice model was the result of an advisory opinion issued in December by the Department of Labor. The DOL letter allowed financial institutions to provide advice directly to retirement plan participants as long as it was done by an independent advisory firm.

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