This brochure provides information about the business practices of NIA. NIA is an investment adviser
registered under the Investment Advisers Act of 1940, as amended (“Advisers Act”). NIA’s advisory
representatives are registered as investment adviser representatives in accordance with the requirements of
the state in which they operate.
NIA was formed in May of 2006 as a limited liability company. NIA is wholly owned by Nationwide Life
Insurance Company (“NLIC”), which is wholly owned by Nationwide Financial Services, Inc. (“Nationwide
Financial”). Nationwide Financial, in turn, is wholly owned by Nationwide Corporation, an intermediate
holding company for entities affiliated with Nationwide Mutual Insurance Company. NIA is an indirect
subsidiary of Nationwide Financial. None of these Nationwide entities is publicly held.
NIA’s advisory services are provided through portfolio management, asset allocation models, and managed
accounts for the programs described below.
ERISA
In conjunction with offering investment advice for certain retirement plans subject to the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), NIA acts as an “investment manager” within
the meaning of Section 3(38) of ERISA and as that term is used under the Internal Revenue Code of 1986, as
amended (“Code”). NIA is a fiduciary within the meaning of Section 3(21) of ERISA and Section 4975(e)(3) of
the Code.
Investment Advisory Services
NIA provides discretionary and nondiscretionary investment advisory services to retirement plan sponsors and
retirement plan participants in both the public/governmental sector (i.e., 457(b) and 403(b)) plans) and the
ERISA private sector retirement plans (i.e., ERISA 401(k), profit sharing plans). In addition, one legacy service
supports tax-qualified defined benefit pension plans.
NIA's investment advisory services are provided through four distinct services: ProAccount, My Investment
Planner (MIP), Smart Alliance, and the Advice Program (each a “Service” and collectively “Services”). The first
two Services are offered to plan participants and the other two Services are offered to plan sponsors. All four
Services are described in more detail below.
The following table illustrates the basic characteristics of each Service and the types of clients to whom it is
available.
Service Discretionary Nondiscretionary Plan Sponsor Plan Participant
ProAccount X X
MIP X X
Smart Alliance X X
Advice Program X X
Services Available to Plan Participants
Pro Account
NIA offers a discretionary managed account service called Nationwide ProAccount (“ProAccount”) that
provides professional management of assets to participants in participant-directed or plan sponsor-directed
retirement plans. ProAccount offers individualized participant level investment advice using a process
designed to address the individual’s investment objectives and risk tolerance. NIA offers ProAccount to plan
sponsors/trustees for the benefit of participants in retirement plans using custody services of affiliated (i.e.,
NLIC and Nationwide Trust Company, FSB) and non-affiliated custodians (collectively, the “Nationwide
Retirement Program”).
An investment advisory affiliate of NIA, Nationwide Securities, LLC (“NSLLC”), offers ProAccount to NSLLC
clients whose individual retirement accounts are custodied at Nationwide Trust Company, FSB (“NTC”).
Neither NTC or NSLLC directly or indirectly exercise control over these assets.
Electing ProAccount
Plan sponsors can elect to make ProAccount available to plan participant. The plan sponsor must approve NIA
as an authorized provider of investment advice to the plan in accordance with the plan’s investment policy
statement (“IPS”) and applicable plan documents. A plan participant seeking to enroll in ProAccount (each a
“ProAccount Client” and collectively “ProAccount Clients”) will enter into an individual investment advisory
agreement with NIA and complete a financial risk-tolerance questionnaire to help identify his or her individual
risk tolerance, investment preferences and investment time horizon, as well as to indicate any reasonable
restrictions the ProAccount Client may wish to place on the management of his or her retirement plan account
assets. This information is used to create a ProAccount Client risk profile, ranging from conservative to
aggressive.
After NIA has accepted the ProAccount Client’s enrollment, NIA will place his or her account assets in an
investment portfolio matching the risk profile, investment preferences and time horizon of the individual
ProAccount Client. Due to similarities in risk profiles and time horizons, an investment portfolio solution may
be appropriate for more than one ProAccount Client. NIA will periodically reallocate and rebalance the
ProAccount Client’s assets in accordance with advice provided by the IFE (see Independent Financial Expert
(IFE) below) based on changes in the ProAccount Client’s profile or current market conditions. NIA’s
investment discretion over ProAccount Clients’ assets is limited to implementing the IFE’s investment advice,
which NIA does not have authority to modify. ProAccount Clients are encouraged to update their risk profiles
whenever their financial situation, risk tolerance or time horizons change. Updates can be submitted by
completing a new risk tolerance questionnaire or providing additional information using online tools provided
by NIA and its affiliates.
Where permitted by state law and as permitted under the documents establishing the plan, plan sponsors of
retirement plans administered by Nationwide may elect to have plan participants automatically enrolled into
ProAccount. Through directed enrollment, plan participants receive written notice of the directed enrollment
process from the plan sponsor and are provided a reasonable opportunity, as determined by the plan sponsor,
to opt out of the service. Subject to their ability to opt out of the ProAccount ongoing service, participants are
automatically enrolled into ProAccount at the plan sponsor’s direction and their assets are managed in
accordance with an investment portfolio that corresponds to their age and assumes a moderate risk profile
unless otherwise directed by the plan sponsor or plan participant. As explained above, participants will also be
given the opportunity to affirmatively elect ProAccount by entering into an investment advisory agreement
with NIA and completing a ProAccount risk tolerance questionnaire, which allows for a more individualized risk
tolerance analysis and may result in the selection of a more customized portfolio.
In certain cases, where plan sponsors direct plan assets, they may elect ProAccount in connection with the
management of employer-directed participant account assets. This is referred to as a Default Investment
Alternative (“DIAs”) or Qualified Default Investment Alternatives (“QDIAs”). In these cases, the plan sponsor
enters into an investment advisory agreement with NIA and directs NIA to enroll participants in portfolios
corresponding to age and risk tolerance parameters specified by the plan sponsor. NIA does not contact
participants of these plans or otherwise assist the plan sponsor in identifying an appropriate investment
portfolio for participants. NIA will allocate and rebalance participant account assets in accordance with the
portfolio selected by the plan sponsor.
Investment Limitations
In its development of portfolios for ProAccount clients, the IFE (see Independent Financial Expert (IFE) below)
does not consider whether the ProAccount Client has assets invested in certain investment alternatives, which
may otherwise be available through their account (e.g., self-directed brokerage accounts, individual stocks,
employer stock, and certain NLIC group fixed annuity contracts). The IFE may add to the list of eligible
investments. The IFE may also use the fixed annuity contracts issued by NLIC when developing portfolios, if
available. In addition, consistent with the Department of Labor’s guidance on the requirements of Qualified
Default Investment Alternatives under the Pension Protection Act of 2006, mutual fund investment options
that charge redemption fees to participants in retirement plans subject to ERISA are not eligible for
consideration by the IFE.
Since ProAccount is designed to be a comprehensive investment option, ProAccount Clients must allocate
their entire available account balance (i.e., all unrestricted assets eligible for investment) to ProAccount. Once
enrolled in ProAccount, NIA implements the IFE’s portfolio allocation instructions. While enrolled in
ProAccount, ProAccount Clients are not permitted to make investment allocation changes to their account
assets that are managed through ProAccount, including fund-to-fund transfers, changes to fund allocation, or
utilization of automatic rebalancing. NIA will have no responsibility or liability for investment allocation
changes ProAccount Clients make to account assets managed through ProAccount in violation of this
restriction. ProAccount Clients retain full inquiry access to their accounts and may still request and be
approved for loans (as applicable) and take applicable distributions. NIA does not have authority to initiate or
modify any distribution instructions from ProAccount Client’s accounts.
NIA does not have any duty, responsibility or liability for assets that are not part of the ProAccount Client’s
retirement plan account or employee benefit plan account being managed through
ProAccount.
Upon termination of the ProAccount agreement by either party, the account holder’s assets will remain
invested in the ProAccount investments last allocated by NIA until the account holder makes changes
to those allocations.
Independent Financial Expert (IFE)
NIA has hired Wilshire Advisors LLC (“Wilshire”) as an Independent Financial Expert (“IFE”) for ProAccount.
Wilshire, a global independent investment consulting and services firm, provides consulting services, analytics
solutions, and customized investment products to plan sponsors, investment managers and financial
intermediaries. Wilshire has extensive manager research and selection capabilities with experienced analysts,
who conduct approximately 1,500 meetings each year to evaluate managers and management firms on
quantitative and qualitative factors. Wilshire has over 45 years of experience developing capital market
assumptions, evaluating risk and liability profiles and constructing diversified portfolios to meet the specific
needs of its clients. Using this experience, Wilshire’s multi-discipline portfolios combine strategic asset
allocation policy with the diversification of multiple investment managers.
NIA employs an IFE for ProAccount to assure that investment advice provided to ProAccount Clients remains
objective and unbiased to the extent that advice could impact products and services offered by NIA or its
affiliates, or investment option service fee payments may be received by NIA affiliates. In addition, with
respect to retirement plans subject to ERISA, use of an IFE is intended to avoid potential ERISA prohibited
transactions.
As IFE for ProAccount, Wilshire develops and maintains model investment portfolios. The IFE considers all
eligible investment options available when creating its model ProAccount portfolios. In its evaluation of these
investment options, the IFE takes into account the range of asset fees associated with each investment option
but does not consider the specific asset fees charged to each ProAccount Client account by providers of other
products and services. The list of eligible investments is subject to change over time and is based on the IFE’s
evaluation of a variety of factors including, but not limited to, client demand, suitability, and technology
requirements.
The IFE has sole control and discretion over the development and ongoing maintenance of the ProAccount
model portfolios, including periodic rebalancing and changes to asset allocation and fund selection. The IFE’s
investment process is designed to take into account the evolving investment needs of ProAccount Clients
over time, as well as varying tolerances for risk. Each ProAccount portfolio will undergo a progression of asset
allocation changes over the course of a ProAccount client’s time horizon and in accordance with his or her risk
profile and investment preferences as identified by information obtained from the ProAccount client or by his
or her plan sponsor. The IFE assesses the ProAccount portfolios at least quarterly to determine if reallocation
or rebalancing is needed. More frequent reallocation or rebalancing may occur as determined by the IFE.
NIA is responsible for the selection and ongoing monitoring of the IFE and implementing allocation changes in
ProAccount Clients’ accounts. In certain circumstances, NIA may terminate the IFE and engage the services of a
suitable replacement IFE for ProAccount without prior notice to affected plan sponsors or ProAccount Clients.
The IFE provides its services directly to NIA and does not have a contractual relationship with any retirement
plan’s plan sponsor that authorizes ProAccount or any ProAccount Client. NIA is responsible for paying all
fees and expenses charged by the IFE for its services.
MIP
NIA provides non-discretionary investment advice to retirement plan participants ("Client(s)") in certain
retirement plans. This service is referred to as My Investment Planner, or MIP. In addition to information about
the plan’s investment policies and goals, NIA collects Client information, including financial risk-tolerance
information, which forms the basis for criteria used to suggest a model portfolio. The completed questionnaire
allows for the identification of the appropriate risk-based portfolio, ranging from conservative to aggressive.
This non-discretionary portfolio advice is provided to the Client. The Client is solely responsible for
implementing the recommended portfolio allocations. NIA does not have discretionary authority over the
Client’s account and is not responsible for buying or selling any securities for the Client’s account.
NIA has hired Wilshire as the IFE for MIP.
Services Available to Plan Sponsors
Smart Alliance
NIA offers nondiscretionary investment advice called Smart Alliance to sponsors of non-ERISA governmental
retirement or deferred compensation plans that offer participants a diverse set of investment options (“Line
Up”). The Line Up may include both proprietary and nonproprietary mutual funds, collective investment
trusts, stable value portfolios, lifetime income solutions and other investment options. NIA provides
recommendations with respect to the Line Up based on the investments that are eligible for adoption by a
Smart Alliance client as identified by the IFE for Smart Alliance (see below) in accordance with the plan’s
investment policy statement, which may change from time-to-time, or such other information needed by the
IFE. NIA’s recommendations to Smart Alliance clients for their Line Ups are limited to implementing the IFE’s
investment advice, which NIA does not have authority to modify. The plan sponsor authorizes NIA to provide
recommendations and to monitor and evaluate from time to time the composition of the Line Up. It is the sole
responsibility of the plan sponsor to decide whether to follow any such recommendation. If the plan sponsor
chooses not to follow NIA’s recommendation, or if the plan sponsor follows it initially and later changes it
without subsequent recommendation by NIA to do so, NIA will have no responsibility or liability for the results.
NIA has hired Creative Planning, LLC, as the IFE for Smart Alliance. Creative Planning provides investment
fiduciary and retirement solutions to a wide range of defined contribution and defined benefit plans. NIA
employs an IFE to assure that investment advice provided to clients enrolled in the Smart Alliance service
remains objective and unbiased to the extent that advice could impact products and services offered by NIA’s
affiliates or service fee payments received by NIA affiliates.
As IFE to Smart Alliance, Creative Planning will evaluate and monitor a set of investment options and identify
those investments that are eligible for adoption by a Smart Alliance client and those investments that are not
eligible for adoption. In its evaluation of these investment options, the IFE takes into account multiple criteria,
such as performance and the range of asset fees associated with each investment option. NIA does not have
the ability to influence or control the IFE’s investment recommendations.
It is the plan sponsor’s sole responsibility to adopt or reject the recommendations it receives through Smart
Alliance.
NIA is responsible for the selection and ongoing monitoring of the IFE. In certain circumstances, NIA may
terminate the IFE and engage the services of a suitable replacement IFE for Smart Alliance without prior notice
to affected Smart Alliance clients.
The IFE provides its services directly to NIA and does not have a contractual relationship with any Smart Alliance
client. NIA is responsible for paying all fees and expenses charged by the IFE for its services.
I.Advice Program
NIA offers a discretionary investment advisory service (“Advice Program”) to plan sponsors of defined benefit
plans and certain other trustee-directed retirement plans that use a retirement program offered by an
affiliated company, Nationwide Trust Company, FSB. Under the Advice Program, plan sponsors appoint NIA to
allocate and reallocate the plan assets in accordance with an investment strategy designed to meet the plan’s
investment objectives, selections and preferences. Prior to establishing an advisory account, the plan sponsor
must complete a Program Questionnaire designed to assist the plan sponsor in its selection of an investment
portfolio (“Portfolio”). The plan sponsor is solely responsible for approving the Portfolio identified or, if it
chooses, selecting a different Portfolio created by the Portfolio Strategist (see below). Following the plan
sponsor’s completion of the Program Questionnaire and selection of a Portfolio, NIA will establish the plan’s
advisory account under the Program, which NIA will manage in accordance with the Portfolio selected by the
plan sponsor.
NIA has hired Wilshire to act as Portfolio Strategist. In general, the role of Portfolio Strategist is similar to that
of the IFE.
Total Client Assets under Management
The amounts below include the assets for all NIA advisory programs as of December 31,2023.
Amount of ProAccount Client assets under NIA discretionary management: $14,333,000,000.
Amount of Client assets under NIA Investment Fiduciary Services: N/A.
Amount of Client assets under NIA non-discretionary management: N/A.
oImplementation of the investment advice provided under this program is left solely up to the
participants. NIA does not track the extent to which the advice was acted upon and therefore
reports no assets under management.