We recently took on a client who came to us because their retirement plan was poorly run. The people who set up the plan had good intentions but they were in over their heads. They had too much going on managing a growing company and did not have the time to administer the plan.
The problems we found were all too common:
- They were improperly excluding bonuses and commissions from the contributions of the participants in the 401k plan. That was not their intent; they just didn’t notify their payroll provider to deduct 401k deferrals from bonuses and commissions.
- They were not submitting contributions within the required time frame. We cleaned that up by taking on the remittance contributions so we could make sure contributions were submitted on the day of the payroll.
- They were weeks behind in approving loans and distributions participants had requested. We stepped in and took on the approval process.
- Employees who became eligible for the plan never received the required disclosures and enrollment material. They never even knew they were eligible. We took on the job of sending out required disclosures and enrollment material at least 30 days before employees became eligible.
That cleaned up the plan and put it in compliance with ERISA law, and it also freed up 4–5 administrative hours per week so the staff so the staff could focus on running the business.
Running your own retirement plan is risky and difficult. Why not hand that responsibility off to a qualified Retirement Plan Management firm that will keep you compliant, up-to-date on changes to the tax laws, and focused on what you do best?