What are Qualified Default Investment Alternatives (QDIAs)?

Qualified Default Investment Alternatives (QDIAs) are specifically designed for participants who do not make an active choice regarding their investment options in a retirement plan. When fiduciaries select these investments, they are essentially creating a safeguard to ensure that participants' retirement savings are managed prudently.

These alternatives are intended to provide a balanced approach to investment by incorporating diverse asset classes that align with long-term growth, thus mitigating risks associated with leaving accounts in cash or low-yield options when a participant is uncertain about where to invest. It reflects a fiduciary responsibility to act in the best interests of the participants, ensuring that even those who do not engage actively with their plan have their assets placed in an appropriate investment vehicle.

In contrast, the other options do not align with the definition of QDIAs; they either pertain to personal choices made by participants or suggest investment strategies that do not encapsulate the fiduciary responsibility integral to QDIAs.