Plan Sponsor Explains 401(k) Investment Selection
In 2017, Kendra Forsythe explained why the Shelton Group chose the Natixis Sustainable Future Funds® for their 401(k).
Prior to the introduction, the average employee 401(k) contribution rate was 4.7%. As of December 2020, that average deferral was 7.8% – a 66% increase. Using the Natixis Sustainable Future Funds as our QDIA has played a big role in improving the amount employees are investing. It’s made the 401(k) discussion more interesting and personal – which makes the idea of investing more attractive. We view it as a retention tool.
VP of Finance & Operations at the Shelton Group (January 2021)
The Shelton Group is the nation’s leading marketing and communications firm focused exclusively on sustainability. In 2017, they were looking for a 401(k) plan investment that aligned with the company’s mission. Working with their financial advisor, Shelton Group added the Natixis Sustainable Future Funds® as a Qualified Default Investment Alternative (QDIA) in July 2017, shortly before this video was filmed. Following up with Kendra Forsythe in January 2021, it’s clear that the Funds have helped increase plan contribution rates and are now viewed as a retention tool.
The experience of this investor may not be representative of the experiences of all investors and is not indicative of future performance or success.
The Funds are designed for investors who will be age 65 around the year indicated in each Fund's name. When choosing a Fund, investors who anticipate retiring significantly earlier or later than age 65 may want to select a Fund closer to their anticipated retirement year. Besides age, there may be other considerations relevant to fund selection, including personal circumstances, risk tolerance and specific investment goals.
The Fund's asset allocation becomes increasingly conservative as it approaches the target date and beyond. Allocations may deviate plus or minus 10% from their targeted percentages.
Investments in the Fund are subject to the risks of the underlying funds and separately managed segments. Principal invested is not guaranteed against losses. It is possible to lose money by investing in the Fund, including at and after the Fund's target date.
Fixed income securities may carry one or more of the following risks: credit, interest rate (as interest rates rise bond prices usually fall), inflation and liquidity. Equity securities are volatile and can decline significantly in response to broad market and economic conditions. The Fund’s ESG investment approach could cause the Fund to perform differently compared to funds that do not have such an approach or compared to the market as a whole. The Fund’s application of ESG-related considerations may affect the Fund’s exposure to certain issuers, industries, sectors, style factors or other characteristics and may impact the relative performance of the Fund – positively or negatively – depending on the relative performance of such investments. Foreign and emerging market securities may be subject to greater political, economic, environmental, credit, currency and information risks. Foreign securities may be subject to higher volatility than US securities, due to varying degrees of regulation and limited liquidity. These risks are magnified in emerging markets. Mortgage-related and asset-backed securities are subject to the risks of the mortgages and assets underlying the securities. Other related risks include prepayment risk, which is the risk that the securities may be prepaid, potentially resulting in the reinvestment of the prepaid amounts into securities with lower yields. Inflation protected securities move with the rate of inflation and carry the risk that in deflationary conditions (when inflation is negative) the value of the bond may decrease. Multi-manager funds may be managed by several subadvisors using different styles which may not always complement each other. This could adversely affect performance and may lead to higher fund expenses.