ABA Retirement Funds Program Overview

Why was the ABA Retirement Funds Program created?

To truly understand the unique benefits of the ABA Retirement Funds Program, it is crucial to understand why it was created.  In 1963, the ABA established the ABA Retirement Funds, a not-for-profit corporation which in turn sponsors the ABA Retirement Funds Program, (the “Program”).  The Program was created because the ABA recognized the need to have an affordable retirement solution which was tailored to the needs of law firms regardless of their size.  They recognized that a law firm’s retirement needs are different from both the typical small business and large corporations.  As a result, the Program was created address these needs and provide the legal community with a unique solution to satisfy a unique challenge.

A Unique Challenge

Often law firms are unique in that they have a relatively small numbers of employees, yet a large percentage are highly compensated and therefore have the ability to save more and have a real need for a quality retirement plan.

Most retirement plan providers find it costly to administer small plans, thus they must charge substantial assets based, administrative, management and distribution fees that negatively impact a participant’s retirement savings.

A Unique Solution

Recognizing this need in the legal community, the ABA Retirement Funds was established as a not-for-profit organization with a board of volunteer attorneys.  Their mission was to create a unique retirement program which could leverage the size of the ABA membership by bringing together nearly 4,000 firms and billions of dollars in assets.  This structure allows the Program to offer a fund menu and services typically available to only the largest corporate plans.  The Program features:
 

• Trust, custody and professional investment fiduciary services from Northern Trust, a leading global asset manager that services 45% of the top 100 corporate plans

• Recordkeeping services from ING, one of the largest recordkeeping firms in the industry

• No out-of-pocket expense to law firms of all sizes and institutionally priced funds for their participants

Couple these benefits with the oversight that the ABA Retirement Funds Board provides over the entire Program and you have a retirement solution that will enable firms to hire and retain quality employees, control expenses and assist them with their fiduciary responsibilities.