Plan Sponsor Quick Tips: Reviewing Your Retirement Plan

Each Monday 401kBasics posts a new tip as a part of our series “Plan Sponsor Quick Tips”. This series is designed to assist plan sponsors in filling their fiduciary role and running their retirement plan efficiently. Your feedback or suggestions on future articles is welcome.

Did you recently assume a fiduciary role with a retirement plan?  If you answered “yes” to that question, then as a fiduciary you have to do good by the employees, the plan sponsor, and yourself. By doing  your due diligence perhaps you could save the company some money. The first step is to sit down with the plan sponsor and discuss the needs and goals of the plan. Some of the topics to discuss include:

  • Contributions – Employee and employer contributions are always crucial factors to consider. Are your current formulas serving your plan needs? What needs tweaking?
  • Withdrawals – Ask if the current loans, hardships and/or distribution provisions are working for the plan. If these options are not available then find out if it’s beneficial to add them.
  • Annual Testing – At the end of each plan year, what tests did you pass or fail? What steps could have been prevented an unwanted outcome?

All these are factors to consider when reviewing the goals and needs of a retirement plan. Before you hire a consultant you could head over to the IRS Retirement Plans Navigator website and compare different plans. Do your homework before you have any discussions with your service provider, to ensure that you’re aware of your options. Should the need arise to change anything in your plan document then AMEND!

This site is for entertainment purposes only. 401kBasics and it’s authors are not financial advisors and no information found on this site should be construed as financial advice.

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