(K)STAR OPEN ARCHITECTURE RETIREMENT PLAN SOLUTION

KSTARKTRADE is a recordkeeping firm that serves the retirement plan industry through its Alliance Members, a group of local third party administrators, or TPAs, and investment advisors.

With an open architecture structure like (k)Star, the recordkeeper, investment manager, third party administrator, and custodian are all separate entities. Through this arrangement, fees for services are fully disclosed and there are no proprietary investment requirements – often, the recordkeeper has the ability to trade virtually any mutual fund or ETF.

An open architecture structure also allows advisors and plan sponsors to receive greater fiduciary support. Through (k)Star, CLS assumes fiduciary responsibility and provides all investment choices. This lessens the plan sponsor’s responsibility in choosing investment options for the plan, resulting in lower personal risk to the plan trustee and organization.

Explore the benefits of (k)star's open architecture approach

(k)Star

  • No proprietary investment requirements—ability for CLS to choose investments options from a universe of 1500+ ETFs and tens of thousands of mutual funds
  • Lower cost and complete fee transparency
    • You know exactly what you are paying for each component of the plan
  • Ability to develop a plan and investment strategy that best meets the needs of the plan sponsor and participants
  • Full fiduciary support from a 3(38) investment manager

Bundled Provider

  • Potential hidden conflicts of interest and excessive fees
  • Service levels that are difficult to evaluate
  • Complicated fee structure that is challenging to understand and increases fiduciary risk
    • Requires more of your time, analysis, diligence, and accountability in order to be in compliance with ERISA

(k)Star Plan Structure & Offering

(k)Star provides a unique approach within the retirement plan arena in that it gives the plan sponsor the freedom to choose service providers for each component of the plan, yet bundles everything together into one simple, lower-cost package.

Through CLS’s (k)Star open architecture retirement plan offering, CLS provides needed fiduciary support by serving as a 3(21) fiduciary to the plan. CLS also accepts appointment as an ERISA 3(38) investment manager for the ETF model allocations CLS manages, as well as for the fund lineup utilizing mutual funds or ETFs.

See what CLS's specific responsibilities are as a 3(21) and 3(38) manager through (k)star

3(21)

  • Exercises discretionary authority or control over the management of the plan or disposition of its assets.
  • Renders investment advice for a fee.
  • Has discretionary authority or responsibility in the administration of the plan.

3(38)

  • Responsible for managing the plan’s assets.
  • Plan sponsor delegates responsibility of selecting, monitoring, and replacing investments to CLS. Plan sponsor is only responsible for choosing and monitoring the 3(38) investment manager.
Explore What the (k)Star Package Offers Advisors & Plan Sponsors
  • Transfer of fiduciary responsibility via use of a 3(38) investment manager (CLS) with extensive risk management experience
  • Investment options utilizing ETFs, which are typically lower cost than mutual funds
  • 8 ETF managed portfolios and 10 ETF target date portfolios, which may increase plan participation and improve participants’ investing outcomes
  • Development fund lineup using either ETFs or mutual funds, covering many assets classes from domestic and foreign equities to fixed income
  • Ongoing fund monitoring and replacement when appropriate
  • Additional time to focus on plan administration and participant education
  • Ability to choose the plan’s custodian and Third Party Administrator (TPA)
  • Robust reporting on plan participation and performance