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Can You Be Sure That Your Investment Adviser is Working In Your Best Interest?

Some participants believe that when they retire, they must roll their retirement account balances out of Wespath Benefits and Investments (Wespath) and into self-managed or broker-managed accounts. However, that is not true.

During your career and throughout your retirement years, you can keep your retirement savings in the United Methodist Personal Investment Plan (UMPIP)1. Still, some participants consider working with brokers or investment advisors to move their assets to another financial institution. If you are considering this option, make sure your choice is a good match for your needs and investment style, and you understand the benefits, costs and the risks involved.

You can keep your money with Wespath
even after you've retired.

Understand Your Options

If you keep your money at Wespath, your retirement savings continue to be invested among Wespath's funds. Wespath offers a diversified fund offering from which you select investments to create your portfolio. The investment funds are managed by highly respected investment managers who aim to achieve above-benchmark performance while prudently controlling risk over extended time periods. (See the "10 Advantages of Keeping Your Retirement Assets with Wespath" below.)

Participants who don't know that they can keep their money in their UMPIP account often decide to roll their retirement savings out of Wespath, often with the help of an investment broker (sometimes referred to as an investment adviser or financial planner). The broker recommends and purchases stocks, bonds and other investments on your behalf, and manages those investments for you.

Often, because of the way they are compensated, brokers have conflicts of interest that could affect your investment performance. By contrast, Wespath provides unbiased, confidential financial planning at no charge2 through EY Financial Planning Services (EY)3, a leading financial services firm. EY doesn't sell investment or insurance products, so you can be sure their advice is guided only by a desire to help you choose what's best for you and your situation.

Do Your Research

If you are considering using a broker, make sure you do your research before trusting him or her with your hard-earned assets. What's best for a broker's business may not be best for your retirement account. Following are questions you should ask your broker adapted from the Department of Labor Fact Sheet How to Tell Whether Your Adviser is Working in Your Best Interest: A Fiduciary Guide for Individual Consumers.

1. What are the costs?

  • Will I pay any front-end loads or sales commissions when I put money in my account?
  • Will I pay redemption fees when I take money out of my account?
  • What are the expense ratios for the funds you are recommending? (You can find expense ratios for Wespath funds on the individual fund pages.)

2. How are you compensated?

  • Do you earn fees or commissions based on the number of products that I buy or the size of my investment?
  • Will you earn a higher fee or other type of compensation if I invest in certain products you recommend or will you receive fees for services related to specific investment products?
  • Will you provide a list of the fees and commissions you receive either directly from me or from other sources in writing?
  • Do you have any conflicts of interest that may interfere with your acting solely on my behalf?

3. Are you a licensed or registered investment adviser?

  • Are you registered with the State, U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) or a Certified Financial Planning Board (CFP)?
  • For how long? What is your experience?
  • Who supervises you, or, are you a sole practitioner?
  • Do you have professional liability insurance?
  • Have you (or your firm) ever been disciplined? For what?
  • If you are a sole practitioner, who will advise me if you are unable to do so?

Carefully review the information you receive to look for fees and expenses being charged and possible conflicts of interest. If the information you receive is not clear, or you see things that make you uncomfortable, ask questions.

Learn More

The Department of Labor also offers additional resources that can help you evaluate the claims made by investment advisers.


10 Advantages of Keeping Your Retirement Assets with Wespath

1. Proven track record: Our funds have earned competitive investment returns compared to mutual funds with similar investments.4

2. Lower expenses: Our fund expenses are below the median for mutual funds with similar investments.

3. No front-end loads or back-end fees: We don't charge sales commissions or redemption fees.

4. Financial guidance: EY Financial Planning Services are available at no charge2 to equip and empower you to make informed investment decisions.3

5. Investment management: The LifeStage Investment Management Service is available to manage your retirement account at no charge2, simplifying your investment decisions.

6. Distribution management: LifeStage Retirement Income is available to manage your distributions in retirement at no charge2. It issues monthly payments to you from your defined contribution account. LifeStage is intended to make your retirement income last for your lifetime and keep pace with inflation

7. Diversified fund offering: If you prefer to self-manage your account, you can select among a diversified offering of Wespath funds.

8. Easy access to account information: Access to your account information and quarterly statements 24/7/365 on the Benefits Access website (benefitsaccess.org). Wespath representatives are also available by phone weekdays during normal business hours.

9. Planning tools: The Retirement Readiness Tool, Retirement Benefits Projection and Retirement Income Calculator online applications are available in Benefits Access to help you plan for retirement.

10. Sustainable investing: We actively advocate for environmental stewardship, workers' and human rights, access to health care and sound corporate governance; and we avoid investing in companies whose products and/or services are not aligned with Church values. Through our Positive Social Purpose Lending Program, we make market rate investments in affordable housing, community development and business opportunities for the working poor around the world.

1 You must maintain an account balance of at least $5,000. The IRS requires a portion of the account—the Required Minimum Distribution (RMD)—to be distributed each year by April 1 following the later of the year in which you reach age 70 1/2 or the year in which you retire or terminate. Wespath calculates and automatically distributes your RMD to you annually.

2 Costs for these services are included in Wespath's administrative expenses that are paid for by the funds.

3 Services are available to active participants and surviving spouses with account balances, and to retired and terminated participants with account balances of at least $10,000.

4 Historical returns are not indicative of future results. For more information about the funds, please see the Investment Funds Description.

Fees Reduce Investment Earnings

  • Front-end load—sales commission, which can be as much as 5.75% of your investment, that is deducted at the time of purchase.
  • Back-end load—redemption fee, typically 5% to 7% in the first year, which can be assessed if you sell a fund within a certain time frame.
  • 12b-1 fee—pays for advertising and marketing, and for brokerage commissions. It is typically an annual fee of 0.25% to 1% of a fund’s net assets.
  • Wrap/advisory fee—comprehensive fee to cover advisory services and other costs that is charged as a percentage of assets under management. Typically covers only the services provided by your broker or advisor, and not the management fees related to the fund.
  • Expense ratio—Fee charged by mutual funds and exchange-traded funds (ETFs) to cover the fund’s total annual operating expenses, including administrative, compliance, distribution, management, marketing, record-keeping fees and other costs. Expense ratios should not exceed 1.25% according to CNN Money.

High fees are associated with lower performance according to the study Assessing the Costs and Benefits of Brokers in the Mutual Fund Industry. So before investing, ask about fees and get an answer from your adviser in writing (e.g., send questions and require a response in an e-mail).

Note: Wespath does not charge front-end or back-end loads, 12b-1 fees or wrap/advisory fees, and our fund expenses are below the median for mutual funds with similar investments.