Self-Directed Defined Contribution Plans
In 1995 researcher John Shoven confirmed that pension assets grew faster than total wealth in the United States
during the 1980’s‚ leading Shoven to conclude that “pensions are how America saves.”
At the same time that pension wealth has grown‚ there has been a revolution in the pension industry
as defined contribution plans‚ and 401(k) plans in particular‚ have become the pension plan of choice.¹
The Nation’s shift from defined benefit plans to defined contribution plans (referred to as self-directed plans) has been accompanied by a shift in the responsibility for managing retirement savings away from the employer. In self-directed plans‚ each employee must decide when to start saving‚ how much to contribute‚ and how to invest the money by choosing the investment options.
Ultimate Goal
Darwin Abrahamson‚ CEO of Invest n Retire‚ LLC‚ understands that each employee’s ultimate goal is to accumulate enough savings in order to maintain a desired standard of living throughout his or her lifetime.
INR’s system (patent pending) for managing tax-deferred retirement plans was designed to assist employees in achieving their goal. Our system includes: online enrollment‚ investment education‚ financial tools‚ online trading‚ daily valuation‚ asset allocation models‚ automatic quarterly portfolio rebalancing‚ self-aligning portfolios‚ and investment options which include an array of exchange traded funds (ETFs) and Dimensional Fund Advisors (DFA) institutional index funds.
Designing Asset Allocation Models
The investment advisor for the plan uses our TandemModels® software²
to design asset allocation models which provide diversified exposure to all major asset classes using exchange-traded funds and DFA funds. Each model targets a rate of return (earnings) which the employee may match to his or her retirement goal.