Guideline’s investment principles
Updated over a week ago

At Guideline, we strive to offer a meaningful way to save for retirement through the use of auto-enrollment, minimizing fees, offering diversified portfolios, and promoting a long-term investing philosophy. Unfortunately, many employees, especially at small businesses, do not have access to a retirement plan at all.

Providing a 401(k) with automatic enrollment generally increases participation and helps take advantage of any employer matching dollars to grow account balances faster. Employer matching and profit sharing can help employees save even more by adding to the amount they are already putting away for retirement.

Guideline cuts participating employees’ costs by avoiding layers of fees and using low-cost index mutual funds. We have designed our managed portfolios using a variety of index funds that have an average expense ratio of less than 0.07%. Please see Guideline’s Complete Fund Menu here.

We subscribe to Modern Portfolio Theory (MPT), a widely accepted framework for managing investment portfolios. According to MPT, broad diversification in a portfolio allows you to potentially reduce your risk for an estimated rate of return, or may maximize your rate of return for a given level of risk.

Our first step in creating diversified portfolios is to identify diversified asset classes for these portfolios and then selecting index funds that represent the full asset classes. It is essential to then understand each participating employee’s time horizon and risk tolerance. With Americans living longer and spending more money in retirement, building larger retirement accounts and investing with longer horizons is key.

At Guideline, we do not want participating employees to fall into the trap of chasing returns. We encourage participating employees to take on a suitable amount of risk and stay the course over time, even when the market is especially volatile. Please note that if you decide to change the funds in which your portfolio invests, a reallocation of your entire portfolio will occur to meet your newly selected portfolio allocation.

With all of this in mind, we attempt to use time to our advantage and automatically rebalance participating employees’ portfolios to keep them on track with their selected asset allocation. Since a 401(k) is a tax-deferred retirement account, there are no tax implications for rebalancing.

Our investment principles reflect our ideals. By expanding access, reducing fees, and providing quality investment management, Guideline offers employee-focused 401(k) plans with managed portfolios we believe are well-suited for participating employees’ needs. To learn more about our investment principles see this helpful blog post here.

The information above is provided for educational purposes only and should not be construed as personal investment advice or a guarantee of performance. All investments involve risk and your investments could lose value. You are advised to consult a qualified financial adviser before relying on the information provided herein.

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