The suspense finally ends! The Department of Labor issued final regulations explaining the types of investments that qualify as "default investment alternatives" for default investment funds under participant-directed account plans. The DOL clarified that where a participant fails to provide investment instructions, a plan fiduciary is entitled to relief from liability for investment losses if the participant's account has been invested in an appropriate fund pursuant to DOL regulations. Under the new guidance, life-cycle, targeted-retirement date and balanced funds all constitute appropriate default investment alternatives but capital preservation and stable-value products do not. Therefore, GICs and money market accounts are no longer appropriate default investment options if a plan's fiduciary desires to be entitled to fiduciary relief. The regulations become effective December 24, 2007. See DOL Reg. 2550.404c-5. Look for a separate Osler Update with more details to be issued soon.