Your Retirement Plan Has a Liability Problem. Here’s the Fix.
If you run a medical or dental practice, or you’re a partner at a law firm, you already carry more responsibility than most people realize. One piece that often gets overlooked: your retirement plan. Specifically, the fact that you’re personally on the hook for how it’s managed.
You’re Already a Fiduciary — Whether You Know It or Not
Federal law requires that whoever sponsors a retirement plan acts in the best interest of the people enrolled in it. For most practices, that’s the partners or owners. It doesn’t matter that you’re a periodontist, not a portfolio manager. If your 401(k) is loaded with expensive funds, hasn’t been reviewed in three years, or doesn’t offer reasonable options for your staff — that’s your problem legally.
A 3(38) investment advisor changes that. When you hire one, you’re not just getting advice — you’re transferring the investment responsibility to them entirely. They make the calls. They take the liability. You get back to running your practice.
What the Difference Actually Looks Like
Think of it this way. An orthopedic surgeon who co-founded a twelve-person practice shouldn’t need to spend part of every partners’ meeting debating whether to swap out a mid-cap fund. But without a 3(38), that’s exactly the kind of thing landing on her plate — and if she gets it wrong, it’s not just a bad outcome, it’s a personal legal exposure.
Or consider a senior litigation partner at a mid-size firm whose 401(k) covers sixty employees, including paralegals and administrative staff who depend on that plan as their primary retirement vehicle. He has a duty to those employees that doesn’t disappear because he’s busy with depositions. A 3(38) makes sure someone qualified is watching the plan every single day — not just when there’s time.
What You Actually Get
A 3(38) advisor reviews your plan’s investment lineup, clears out anything that’s outdated or overpriced, and rebuilds it around a clear investment strategy. From there, they monitor it on a regular schedule and make changes as needed — documenting everything along the way.
That documentation matters. If the Department of Labor ever comes knocking, or a participant raises a complaint, the paper trail showing a credentialed professional was actively managing the plan is your protection.
Beyond liability, the plan simply gets better. Better fund options. Lower costs. Clearer choices for employees who are trying to build real savings.
A Benefit Worth Competing With
Good physicians, dentists, and attorneys have options. A retirement plan that’s been professionally managed — and that employees can actually trust — is a meaningful part of why someone chooses to stay. Engaging a 3(38) isn’t just a risk management decision. It’s a statement about the kind of practice you’re running.
