Fiduciary Service

Why Are Fiduciaries Turning to Independent Investment Advisors?

Why Are Fiduciaries Turning to Independent Investment Advisors?

Fiduciaries must be prudent experts if they are to act in a capacity that meets the standards outlined in ERISA §404(a).

Most good people placed in positions to oversee their company’s retirement plan are not trained in investment matters and yet ERISA holds them to the same process standards as a professional money manager.

Rising fiduciary concerns are catching the attention of regulators.

DOL Working Hard in the Atlanta Area to Ferret Fiduciary Breaches, Ilene H. Ferenczy, LLC, April 24, 2008.

Court Says Section 401(k) Plan Participants Can Assert ERISA Section 502(a)(2) Claim, Meredith Maresca, April 3, 2008

First fallout from the LaRue case from February, 2008.

DOL reported the following statistics for the one year period ending 9/20/07:$1.5 billion in total monetary results (fines, penalties, etc.)74.23% of civil investigations closed with monetary results (this is a 30% increase since 9/30/2001 which means they are getting more aggressive in handing out penalties)37.23% of criminal investigations closed with guilty pleas or convictions161,000 worker complaints led to $96 million in monetary results and 687 new investigations

Why Sentinel Benefits & Financial Group?

We are licensed investment advisors.

Our fees are fully disclosed in writing and we are not permitted to accept compensation from investment managers.

We are independent and work exclusively on behalf of our clients.

We bring investment expertise to your due diligence team and we shoulder an equal share of the responsibility for our actions.

We will acknowledge our role as “investment manager” as defined in section 3(38) of ERISA and thus a fiduciary, with respect to the plan through written agreement.

We are a plan co-fiduciary.

We carry $15-million in E&O insurance coverage.

Investment Research Process

Identify investment managers that have demonstrated more consistent long-term performance in their areas of expertise.

1. Quantitative. We review an investment manager’s rate of return, relative risk measurements, and management expenses as compared to its peer group.

2. Qualitative. We also evaluate a manager’s reputation for ethical practices, style consistency, and administrative infrastructure.

3. Bottom Up Selection Process.We concentrate first building diversified portfolios using low correlating asset classes and then we seek the best money managers that specialize there.

The foundation of our long-term investment management approach is our expertise in research and disciplined methodology.

Matthew H. McPhail, CFAChief Investment Officer

Our tools and resources…

Investment Advisory Services

Diagnostic Plan Appraisal

We will evaluate your plan’s current investment offering by benchmarking the investment return, risk, and expenses to its peers and relative indices, by providing an assessment of asset class overlap or gaps, and by evaluating the overall investment offering to the plan’s current investment policy statement.

Develop Investment Policy Statement

We develop an Investment Policy Statement that is consistent with ERISA 404(c).

Manager Investment Selection Process

Our investment manager research and selection process is designed to select the appropriate asset managers for each asset class to be represented within the plan. Our quantitative screening ensures that each manager meets superior standards for style consistency, risk adjusted performance, consistency of performance and low expenses. Our experienced analysts further assess the philosophy behind the numbers, the process by which it is implemented and most importantly the people who manage the portfolios.

Lifestyle Portfolio Management

We create three Lifestyle Portfolios from the funds offered in your Plan. Each portfolio will be designed to meet a specific risk-return profile. Lifestyle Portfolios allow investors the opportunity to choose one fully diversified investment solution that is designed to match their individual goals, risk tolerances and time horizons. Each portfolio invests in a diversified mix of funds carefully chosen by Sentinel Pension Advisors. As an all-in-one solution, Lifestyle Portfolios are designed based targeted asset mixes of cash, fixed income and equity funds.

Investment Advisory Services

Investment Advisory Services

Monitor and Measure

Once the plan’s investment policy has been established and the investments have been chosen, we will continue to subject the funds to a comprehensive performance attribution analysis to ensure that each investment continues to demonstrate the performance and asset class characteristics that it was selected to provide.

Trustee & Investment Committee Meetings

When appropriate, we will arrange a meeting with the Plan Trustees to document the performance of the plan’s investments and to make any recommendations that may be appropriate for changes. These meetings are documented and become part of the Plan’s Due Diligence file.

Participant Counseling

Provide employee group communication services to plan participants. Meetings will be done onsite at the client’s work facility. Individual meetings are also available.

Participant Counseling

4 different group presentations

401(k) Education (cover Plan specifics)Investment BasicsFinancial PlanningRetirement Income Planning

Participant Counseling

One-to-one meetings with plan participants30 minute sessions scheduled in advance toallow advisor time to prepare

Discuss Your 401(k)Personal Risk AssessmentRetirement Income PlanningAsset Allocation AnalysisDiscuss Other Accounts to coordinate Financial Plan

“The foibles of plan participants have become common knowledge. Intimidated by the prospect of having to make investment decisions, some employees avoid enrolling in the plan at all. Those who enroll often feel overwhelmed by the number of investment options, and simply select one or two funds instead of a diversified allocation. Of the participants who do diversify properly, few follow up later to review and rebalance. Small minorities of participants make hyperactive investment changes, but the vast majority make almost no changesat all.”

John Nelson, PLANSPONSOR Magazine

September, 2006

Wealth Management Services

Retirement Income Planning

Accumulation Phase – contribution targets, asset allocationDistribution Phase – distribution targets, cash flow analysis, asset allocationAnnual Review

Asset Protection

Review strategic uses of insuranceComplete needs analysis including life, health and long-term care

Tax Planning

Proactive tax minimization strategiesWork with existing accountant or establish new relationship

Estate Planning

Review strategic estate planning strategies to preserve wealth and save taxesRegular reviews to insure documents are currentFamily involvementWork with existing attorney or establish new relationship

Accountant

Healthcare Expert

Insurance Agent

Other

Tax &Estate Expert

Attorney

Financial Advisor

Employers partner with us to be their single, expert resource for all of their employee benefits.

For more information, call 800.436.6689 or email referral@sentinelgroup.com.