Abstract
This article discusses legal means to minimize investment risk if individual accounts are added to Social Security. It describes current fiduciary standards in the Employee Retirement Income Security Act of 1974 (ERISA) that apply to private pension plans transferring investment responsibility to participants. It argues that rulings and regulations issued by the Department of Labor under ERISA provide a model of best practice for individual accounts under Social Security. It also suggests that such protective measures could be implemented by a Board of Trustees with fiduciary duties and responsibilities, such as the Federal Thrift Savings Board that oversees the Thrift Savings Plan, the individual account plan for federal employees, or the State Board of Administration that will implement the recently established individual account plan, the Public Employee Optional Retirement Program, for state employees in Florida. Or, if the Board approach is deemed unacceptable, responsibility for implementing these protective measures could be assigned to an existing or newly created federal agency.
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