A Valuable Benefit through an Accredited Team
A 401(k) and/or defined contribution plan can be one of the most valuable benefits to employees and business owners. When candidates are choosing between firms offering equal pay, companies with the more generous benefits package will more often win the day and the candidate.
Establishing a prudent process to meet fiduciary responsibilities and monitoring investment assets and costs through benchmarking drives a plan’s success. Our team of Certified Plan Fiduciary Advisors and Accredited Investment Fiduciaries (CPFA & AIF®) supports plan sponsors and investment committee members to alleviate risk, improve participation and reduce inefficiencies. Acting as a co-fiduciary, we guide investment selections and advise on investment performance to meet plan goals and objectives outlined in a customized Investment Policy Statement (IPS).
Have You Benchmarked Your 401(K) Plan?
Benchmarking your 401(k) plan is a process that compares your plan with other plans that are similar in types and/or size. The comparison is done mostly to compare fees based on number of plan participants and total assets.
1. Meet your fiduciary duties under ERISA
Plan sponsors and fiduciaries must develop and maintain written investment due diligence procedures with supporting documentation to meet their fiduciary obligations. Under ERISA (the Employee Retirement Income and Security Act) requirements, plan fiduciaries may only pay fair and reasonable plan expenses. Documenting this obligation with a benchmark of all costs from the record keeper, third party administrator, and advisor compared to plans of similar size and assets will keep a plan compliant and fees transparent.
2. Lower the cost for your participants
As a fiduciary, the responsibility is to keep costs fair and reasonable for the participants paying most of the plan expenses. Conducting a benchmark of plan fees can identify ways to lower the cost to the participants by considering lower-cost investment options and examining the need for a formal RFP (request for proposal) of all plan providers.
3. Improve plan features and design
Retirement providers are always improving their model to offer new features as legislation and trends change. What might not have been explored three years ago, might now be common and proven effective at increasing retirement readiness for your employees and shareholders. The addition of a defined benefit plan is a unique strategy that may not have been viable in years past. Benchmarking your plan every 3-5 years is the best way to see if there are features and plan design elements worth considering.
Advisor Contacts
A Certified Plan Fiduciary Advisor (CPFA) is a financial professional that demonstrates expertise and experience working with retirement plans, including 401(k)s, 403(b)s and other defined contribution plans.
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Peter Bradshaw, ChFC®, CPFA
Associate Partner | Wealth Manager
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Chris Burgos, CFP®, ChFC®, CFS, AIF®
President & CEO | Wealth Manager
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Jason Hagerman, CFP®, CEPA®, AIF®,
CPFA, CLTC®
Associate Partner | Wealth Manager
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Hardik Shah, CFP®, ChFC®, CPFA
Senior Partner | Wealth Manager
Find Your Plan
Financial Professionals do not provide specific tax/legal advice and this information should not be considered as such. You should always consult your tax/legal advisor regarding your own specific tax/legal situation.
4796633 06 2022