Best Practices to Help Your Plan Stay Compliant
If you’re a business owner with a retirement plan, you’re providing an extremely valued benefit to your team. But did you know this also is an area of great risk for you?
A Legal Minefield
Over the past decade, there has been a growing trend of litigation against retirement plan sponsors. While originally this legal action seemed to only impact the largest employers, over the past years lawsuits have cropped up impacting both small and medium-sized plans. As a result, many employers are forced to defend or settle costly lawsuits.[i] Even if the lawsuit has no merit, defending it can be prohibitively expensive.
Recent lawsuits have made it clear that a “set it and forget it” approach won’t cut it. From these cases, we have learned what the courts expect. These actions include regularly benchmarking fees to make sure they are reasonable, actively monitoring fund choices as well as replacing any funds that experience issues.
You Have Personal Liability
In this case, there’s a lot at stake. In fact, most business owners will be considered plan fiduciaries and as such, you have personal liability as well as business liability.
Not All Financial Advisors Are Alike
As you can probably see, it’s smart to rely on professionals who understand best practices to help your plan stay compliant. But when it comes to your retirement plan, not all experts are alike. Many have conflicts of interest, which can harm your participants and create liability. Then, some financial advisors are not willing to share your fiduciary responsibility with you.
Helping Reduce Your Liability
3 Financial can share your fiduciary responsibility for selecting and monitoring plan investments as an advisor falling under ERISA Section 3(21). In that role, we can provide the following services to you:
- We’ll help you understand your responsibilities and suggest strategies to manage risk and potential liability
- We’ll work with you to develop an Investment Policy Statement for your plan
- We’ll help you find and monitor service providers
- We’ll help you benchmark fees and negotiate lower rates
- We’ll provide ongoing investment information, monitoring, and advice
Helping Your Participants, Too
Along with helping you, we’ll help your team get the most out of their retirement plan. Here are some of the services we provide:
- Onsite enrollment meetings to ensure staff understands key features of the plan and how to get the most out of the plan
- In-person workshops to teach participants key investing and savings skills
- Customized savings goals and investment advice
The Local Expertise You Need to Feel Confident
As a local firm, we’ve been offering a more convenient option for Hawaii’s employers since 2007.
Unliked mainland-based firms, we’re here when you need us. We work in the same time zone and are available for in-person meetings when that will be helpful.