Are You Getting the Most Out of Your Company Retirement Plan?
Introduction
Company-sponsored retirement plans — especially 401(k) plans and SIMPLE IRAs — are powerful tools for attracting talent, reducing taxes, and building long-term wealth. But many plans are set up once and then left on autopilot.
As a plan sponsor, you are a fiduciary. That means ongoing oversight isn't optional — it's required.
This guide walks through the key questions every business owner should be asking to ensure their plan is competitive, compliant, and delivering real value.
1. Are You Conducting an Annual Plan Review?
Q: What should an annual plan review include?
At a minimum, your annual review should cover:
- Plan performance and participation rates
- Employer contributions and match structure
- Compliance and fiduciary documentation
- Service provider evaluation
- Employee outcomes (are people on track to retire?)
Why It Matters
Failing to conduct regular reviews can expose you to fiduciary risk and missed optimization opportunities.
2. When Was the Last Time You Reviewed Plan Fees?
Q: How often should I benchmark my plan's fees?
Every 2–3 years at minimum. This includes reviewing:
- Recordkeeping fees
- Investment expense ratios
- Advisory fees
Why It Matters
Fees have a direct impact on participant outcomes. Even small reductions can significantly improve long-term returns.
Best Practice
Conduct a formal benchmarking or RFP process periodically to ensure your plan remains competitive.
3. Is Your Plan Design Still Optimal?
Q: Does my current plan design still fit my business?
It depends on changes in your workforce demographics, ownership structure, profitability, and business goals. Things to evaluate include:
- Employer match vs. profit sharing
- Safe harbor vs. traditional 401(k)
- New comparability or cash balance plan pairing
- Vesting schedules
- Automatic enrollment and escalation
Why It Matters
A well-designed plan can maximize tax savings for owners, improve employee retention, and increase participation and outcomes.
4. Should You Still Be Using a SIMPLE IRA?
Q: When does it make sense to move from a SIMPLE IRA to a 401(k)?
Consider upgrading if:
- You want higher contribution limits
- You're growing and adding employees
- You want more flexibility in plan design
- You want to add features like loans or Roth contributions
Why It Matters
SIMPLE IRAs are easy — but often limiting. As your business evolves, your retirement plan should too.
5. Are You Conducting an Investment Review?
Q: How often should investments be reviewed?
At least annually. What should be reviewed:
- Fund performance vs. benchmarks
- Expense ratios
- Risk alignment
- Manager consistency
An emerging question many plan sponsors face is whether to include alternative investments like private equity. Key considerations include participant sophistication, liquidity constraints, fiduciary responsibility, and plan size and administration complexity.
Why It Matters
Investment oversight is one of your core fiduciary duties. Documentation of this process is critical.
6. Are You Benchmarking Your Investment Lineup?
Q: What does benchmarking actually mean?
Comparing your plan's investment options against:
- Industry peers
- Appropriate market indices
- Similar asset class funds
Why It Matters
It ensures participants have access to high-quality, cost-effective investment options.
7. Are You Providing Employee Education Beyond the Basics?
Q: What should employee education include?
More than just "how the 401(k) works." High-impact topics include:
- Financial literacy fundamentals
- Budgeting and debt management
- Home buying strategies
- College planning
- Estate planning basics
- Tax-efficient investing
Why It Matters
Better-informed employees participate more, save more, and stay longer — directly improving the ROI of your plan.
8. Are You Documenting Your Fiduciary Process?
Q: What does good fiduciary governance look like?
It includes:
- Regular committee meetings
- Documented decision-making
- Investment Policy Statement (IPS) adherence
- Fee and investment reviews
- Service provider oversight
Why It Matters
Good process — not perfect outcomes — is what protects fiduciaries.
9. Have You Received Fiduciary Training?
Q: Do plan sponsors need formal training?
Yes — especially those serving on a retirement plan committee. Training should cover:
- ERISA responsibilities
- Duty of prudence and loyalty
- Monitoring requirements
- Prohibited transactions
Why It Matters
Understanding your role reduces risk and improves decision-making.
10. Are You Leveraging Executive Benefit Planning?
Q: What additional strategies should I consider for owners or key employees?
Beyond the 401(k), consider:
- Non-qualified deferred compensation (NQDC) plans
- Cash balance or defined benefit plans
- Supplemental executive retirement plans (SERPs)
- Equity-based compensation strategies
Why It Matters
Qualified plans have limits. Executive benefit strategies can help bridge the gap and retain top talent.
Final Thoughts
Your retirement plan should not be a "set it and forget it" benefit. It's a dynamic tool that, when properly managed, can:
- Reduce taxes
- Attract and retain employees
- Build meaningful wealth for both owners and staff
- Minimize fiduciary risk
Call to Action
If you haven't reviewed your plan in the past 12 months — or benchmarked it in the last 2–3 years — it's time for a fresh look.
Let's conduct a complimentary plan review, where we will:
- Benchmark your fees and investments
- Evaluate your plan design
- Identify opportunities for tax savings and optimization
- Review fiduciary processes and documentation
- Explore advanced strategies for owners and key employees
The goal is simple: ensure your retirement plan is working as hard as you are.
Securities and Investment Advisory Services are offered through Osaic Wealth, Inc., member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced here are independent of Osaic Wealth. Osaic Wealth does not offer tax or legal advice. This content is for informational purposes only and does not constitute legal, tax, or investment advice. Plan sponsors should consult qualified ERISA counsel and financial professionals regarding their specific fiduciary obligations and plan design decisions.