Key Issues with 401(k) Plans
Are you a decision-maker for your company’s 401(k)? Owners of closely-held businesses wear many hats: officer, employee, “chief cook and bottle washer.” One other hat you may wear is ERISA fiduciary of your company’s tax-qualified retirement plans – and that’s a hat you don’t want to forget about.
Without an understanding of the responsibilities that go with this role, fiduciary liability is just a heartbeat away. The Department of Labor considers fiduciaries as ultimately responsible for making sure their retirement plan follows all applicable laws.
If fiduciaries fail to act prudently, not only is the business subject to lawsuit, but each fiduciary – owner, director, or member of the board - is personally open to lawsuit.
Unfortunately, it’s all too easy for mistakes to be made on plan start up, or for owners to “set it and forget it,” leaving themselves open for potential problems later.
For instance, how do you know that you’re fulfilling your obligation to provide participant education to your employees? Or how do you properly assess if the Plan Manager’s fees are appropriate? These are the kinds of issues I help Plan Sponsors address.
