PHOENIX, Ariz. — Phoenix City Deferred Compensation Trust has undertaken a soup-to-nuts transformation of its $500 million 457 plan.
The fund replaced a cornucopia of 39 investment options with a more manageable 11 core funds and five lifestyle funds, said Cathleen Gleason, the city's deputy budget and research director for the city.
The fund's board decided early last year to do a revamp, and issued a request for proposals for a new consultant. Mercer Investment Consulting, Chicago, was hired last summer, replacing Becker Burke Associates, Chicago.
Last fall, Phoenix issued an RFP for a new service provider. At the same time, Mercer was working on a new investment policy and on overhauling the investment options.
Nationwide Retirement Solutions, Columbus, Ohio, was the winner, replacing ICMA Retirement Corp., Washington. ICMA was a bundled provider for the fund. Nationwide has an "alliance" with the fund; although it is not a bundled provider, it handles all the record keeping, administration and investment monitoring and education.
"Mercer said instead of confusing people with lots of choices we should make sure people had enough choices to make a diverse portfolio and make sure they have the ‘best in class' options in each asset class," said Ms. Gleason.