CitiStreet, a joint venture between Citigroup and State Street Corp., announced today that it will provide investment advice directly to plan participants using systems built by Financial Engines Advisors, an independent investment advisory firm

This will be the first time that 401(k) investors will receive specific investment advice from the firm that manages their plans. CitiStreet said that the new advice model is a result of an advisory opinion issued last December by the Department of Labor. The Department of Labor letter allows financial institutions to provide advice directly to retirement plan participants as long as it’s done by an independent advisory firm.

CitiStreet was previously providing very little information to 401(k) investors, only providing data on five index funds.

Now, plan participants who call a CitiStreet Call Center will have access to financial advisers who can make specific fund recommendations and implement changes immediately. CitiStreet will also offer online investment advice so that participants can log in to their account and review information provided by Financial Engines. Finally, the firm’s onsite guidance and education workshops will now include face-to-face meetings with advisers.

"Expanding the use of advice technology allows CitiStreet to deliver premium and personalized services for participants as investors," CitiStreet CEO James Phelan, said in a statement. "CitiStreet, as advisor, will deliver service through multiple channels, ensuring the highest quality advice available to all participants."

CitiStreet is one of the nation’s largest retirement plan providers. The company serves more than 6.5 million plan participants and administers approximately $200 billion in assets in the U.S. for an array of retirement savings vehicles.

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