What You Need To Know About Retirement Plan Committees
Being a retirement plan sponsor can be a bit overwhelming and one of the major reasons that retirement plans are mismanaged is because there is a lack of management. Retirement plan committees regardless of the size of the plan sponsor can be an effective method of managing a retirement plan. Like any tool, a retirement plan committee must be used correctly or it ends up becoming more of a problem than it’s worth. So this article is about how retirement plan sponsors can delegate their retirement plan committee and some of the things they should avoid by setting one up.

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401(k) Plan Provisions That Should Be Reviewed For “Tinkering”
When I was in law school, I was a bit of a malcontent. I’m a big fan of truth and transparency, but that’s me. One of the explanations in retort to my criticisms was that things done a certain way were done that way because they were always done that way. Well, what if what was always done was wrong? When you set up a 401(k) plan, the plan provisions weren’t set in stone, so it’s beneficial to look at your plan provisions to determine whether they still fit your needs and the needs of your employees.

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What 401(k) Plan Sponsors Should Do When The Markets Go South
There is a proverb that success has many fathers, but failure is an orphan. It means that many people will seek credit for success, but very few will accept responsibility for failure. Plan sponsors and plan providers love to talk up 401(k) plans when stock markets are good, but not many want to talk when the stock markets are doing terribly. As a 401(k) plan sponsor, you need to do your job when the market is good or bad. Actually, times like these are when you need to be more vigilant. This article is all about what you need to do.

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It doesn't matter where your plan provider is
I’m the guy who will travel to a Target further from my home because the Target in Farmingdale is far better than Westbury and Valley Stream and people think I’m crazy to travel 15 minutes more for a better run store with better clearance sales. When my family has had medical issues, we travel to the best doctor out there whether it’s in the same town or New York City, which has some of the best medical care in the world.
So I’m still shocked when plan sponsors want plan providers who are local. Shopping locally for pizza or food makes sense, but technology makes requiring your plan providers to be local silly.

Thanks to technology, the plan provider across the country can virtually be in any meeting you need them to attend. As an ERISA 3(16) plan administrator with clients around the country, I’m always there when my clients need me even if they are in San Francisco. The Internet has made the world smaller, so there is no need to hire a plan provider that is local. Since you can have online meetings and constant email messages, there are no requirements that your providers be local. Find the best plan provider out there, whether they’re in town or thousands of miles away.

In real estate, it’s all about location, location, location. When it comes to plan providers, it’s about competence and reasonable fees.
Confirm what the audit says
If you have a retirement plan with more than 100 participants, you probably have a plan audit (if you have more than 120 participants, you do). Like with any plan provider, there are a lot of great auditors out there and some not so good.

So if your auditor brings up issues dealing with plan compliance, confirm those findings with plan providers and/or ERISA attorneys because auditors may be great at accounting, they aren’t legal experts. I have an advisor-client (cheap plug here) who asks me to confirm what the auditors are saying on the compliance end and occasionally, they’re wrong and their answers could lead to compliance headaches, especially where the Department of Labor and Internal Revenue Service are concerned.
Get those participation agreements done
It’s been happening a lot lately: a plan sponsor with several participating employers, not realizing that participation agreements for some of these employers weren’t done. This is just a silly mistake to make.
While some plan documents may recite all the participating employers in the plan document, most don’t. They require participation agreements (they also may be called adoption agreements) for each participating employer. I’ve had several voluntary compliance program submissions with the Internal Revenue Service just because of a failure to properly secure a participation agreement for one or more employers. It’s a costly mistake that shouldn’t happen.