2020 has been hard for small businesses; those who remain open have often had to make painful operating decisions for all concerned. Hopefully, your employees understand you’re not taking those decisions lightly. But they can still be frustrating.
While improving your company 401(k) plan is not a panacea, it will show your employees you’re committed to improving their benefits, and you value the work they are doing in this difficult time. This could help you retain your workers and improve their morale. To beef up your 401(k) plan accordingly, here are the top three areas to examine in a plan review.
1. Can You Reduce Your Plan’s Fees?
Has it been a while since you’ve reviewed your 401(k) fees? For numerous reasons, 401(k) and 403(b) fees have dropped dramatically over the last five years. If you have not revisited your retirement plan fees lately, it may be a good time to do so. Reducing fees helps your employees save more of their hard-earned money and can improve their account balance. If your company is paying for service providers such as a record keeper or advisor, it could also save your business some cash.
2. Can You Offer More 401(k) Value?
Reducing fees is important, and the easiest way to increase the value of your 401(k) plan for yourself and your employees. But there are other features employees care about beyond fees.
- Better investment options
- Faster advisor response to employee questions
- Improved financial planning resources
- Enhanced online access to their accounts
- Improved quarterly statements
You can score even more value for your employees if you can reduce fees while also strengthening the quality of their plan.
3. Can You Reduce Your Retirement Plan Risk Exposures?
This last item is why a 401(k) plan review may be a 2020 win-win-WIN for you, your businesses and your valued employees. If you could lower costs, improve services and reduce potential liability for your company, you position your people and your business for optimal odds of success.
Hiring a 3(38) fiduciary investment advisor is among the best ways to make it all happen. A 3(38) Investment Manager lets you shift your fiduciary responsibility for investment selection and monitoring to a firm like Plancorp. You should know if your advisor is serving as a “3(38).” Additionally, Plancorp helps business owners build governance structures and processes to monitor the most likely Department of Labor and IRS “red flags.”
Please be in touch for your complimentary 401(k) plan review (or 403(b) if you are a non-profit). We would love to help your business build for a better future.
Disclaimer: This material has been prepared for informational purposes only and should not be used as investment, tax, legal or accounting advice. All investing involves risk. Past performance is no guarantee of future results. Diversification does not ensure a profit or guarantee against a loss. You should consult your own tax, legal and accounting advisors.