Retirement plans come in all shapes and sizes: DC Plans, DB Plans, Non-Qual, 401(k), 403(b), 401(a), 457, SEP IRA, Simple IRA, Roth IRA, Cash Balance, HSA… and any other number letter combinations that you can think of.
Retirement Services & Financial Advisors - Serving Columbus & Beyond
Among the primary choices a plan sponsor has when considering the management of their 401k plan is bundled or unbundled. For many plan sponsors initiating a smaller plan, the bundled approach may seem more appropriate due to its lower cost. As many later find out, the lower costs also mean they are not getting the advice they need or are being plagued by hidden fees.
Just as most 401k plans are unique in their offerings and operations, so too are the investment committees that should be formed to guide them. However, in confronting the critical issues facing employers in the management of their plans, all employers, and their investment committees should address one key question, if not quarterly, at the very least, annually.
As is customary with the proposal of any new regulatory rule or provision, the Department of Labor has opened the floor to comments regarding its proposed rule change to extend fiduciary responsibilities to all advisors who work with qualified retirement plans.
After a rather tumultuous decade in which the overall performance of 401k plans is best described as anemic, we may be entering a period of redemption that could have 401k plan sponsors and participants smiling again.
If a recent employee retirement survey is an indication, retirement plan sponsors have a tremendous opportunity to significantly improve worker productivity, optimize plan participation while fortifying their liability firewall – all in the name of plan management best practices.
Recent multi-multi-million dollar class action settlements by Nationwide, Mass Mutual and Lockheed Martin are only the latest wakeup calls for plan sponsors who are coming under magnified scrutiny by employee groups and advocates.
With the heavy emphasis by plan sponsors on increasing plan participation and deferrals, another, potentially larger, challenge often simmers on the back burner. For many small to mid-size plans, the growing pool of terminated participants could begin to boil over, wreaking havoc on recordkeepers and significantly increasing plan costs.
Proactive vs. Reactive, it's two words that once you hear them you immediately realize you want to be proactive.