Business Owner Questions

October 30, 2013

As a business owner, you should be able to answer the following questions:

Are you paying too much for plan administration services for your qualified retirement plan?

There are a variety of fees associated with a retirement plan; with the operating expense for the investment options, as well as the annual administrative fee accounting for the majority of the plan expenses. Recently, we prepared a proposal for a company that had a large 401(k) plan and the company last year paid over $100,000 to their retirement plan provider just in administration costs. Know what you are paying and what you are receiving. Know what fees the company pays and what fees are being passed on to the employees.

Are you spending too much time administering the plan?

Administration of the plan can be relatively easy. If administration is a burden for you or your human resources director you need to look at the options available to you. Some plans have Third Party administrators that are separate from the fund administration and this can sometimes add more time and/or expense.

Does your current plan have trouble passing discrimination testing?

If so, you may want to look at a safe harbor plan. This could help you and your highly compensated employees put more money away.

Does you plan offer employees investment options?

A simple RFP (Request for Proposal) or analysis of your plan will help you know this. One of our wealth managers can provide you with a complete analysis of your plan at no charge.

If any of these questions ring true for you, a turnkey, benefit-sensitive retirement plan may be just what you need. As a Plan Sponsor you should benchmark your plan every three years (according to the Department of Labor) to ensure your retirement plan is competitive in terms of fee's and investment choices.

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