Christine Hradsky No Comments

Fees for 401(k) Services: What Plan Sponsors Need to Know

Fees 401(k)

Avoid having the gavel come down on you by being well aware of the fees associated with your employee benefit plans.

Political candidates who don’t know the cost of a gallon of gas or a movie ticket usually wind up paying that price with voters and losing on election day. Likewise, many plan sponsors are finding themselves on the losing side of lawsuits because they allowed their defined contribution plan to pay unreasonable service fees. Read more

Christine Hradsky No Comments

Duties of an ERISA Plan Administrator

ERISA

ERISA plan administrators perform many critical functions that require a lot of time, care, and integrity.

Plan administrators and sponsors are fiduciaries who are charged with the highest level of responsibility, fair dealing and good faith recognized under the law. As a fiduciary, you have a legal duty to provide the utmost care and servicing on behalf of the beneficiaries in your plan. Because of the critically important retirement assets you oversee as a fiduciary, the federal government demands the best out of its plan administrators.  Read more

Christine Hradsky No Comments

Is an Association Health Plan Right for Your Company?

Association Health Plan

Last October, the Trump Administration set in motion the development of “association health plans” as an alternative for employers to provide health insurance to their workers.

Association health plans (AHPs) are health benefit policies made available to small employers through a group purchasing arrangement for the benefit of association members and their employees. Under the old rules, AHP availability was limited to tightly linked employers (such as parent-child companies). Under new regulations issued by the Department of Labor on June 19, “an AHP now could offer coverage to some or all employers in a state, city, county, or a multi-state metro area, or it could offer coverage to businesses in a trade or industry group nationwide.” Read more

Christine Hradsky No Comments

Uncashed Distribution Checks: Best Practices For Plan Sponsors

Distribution Checks

When employees leave, it can be difficult for benefit plan sponsors to know where to send their information. Follow these best practices for handling such situations.

Defined contribution plan sponsors face numerous challenges when workers change jobs, and the Department of Labor (DOL) is paying close attention to how employers are dealing with these situations.

Often, outgoing workers don’t provide instructions or forwarding information, leaving it up to the plan sponsor to figure out what to do with the assets that are left behind.

From 2004 to 2013, more than 25 million participants in workplace plans left at least one retirement account behind when changing jobs, according to a January report from the Government Accountability Office (GAO). Meanwhile, the DOL estimates that $15 million in distribution checks goes unclaimed each year. Read more

Christine Hradsky No Comments

Congress Raises 401(k) Hardship Withdrawal Limits

401(k) Harship Withdrawal

Restrictions on employee 401(k) hardship withdrawals will be eased next year, thanks to new legislation enacted by Congress in February 2018.

Most 401(k) plans permit hardship withdrawals, though plan sponsors aren’t required to allow them. As it stands today, employees seeking to take money out of their 401(k) accounts are limited to the funds they contributed to the accounts themselves, and only after they’ve first taken a loan from the same account. Loans must be repaid, of course. The theory behind the loan requirement is that employees would be less apt to permanently deplete their 401(k) accounts with hardship withdrawals. Read more

Christine Hradsky No Comments

Understanding 401(k) Plan Fees and Expenses

401(k)

401(k) plan fees and expenses generally fall into three categories.

Plan sponsors face many challenges. One of the biggest is determining their 401(k) plan’s total cost, including the cost of investment management, plan administration and participant services. Fees and costs associated with a retirement plan’s investments are inevitable. However, ERISA requires that any compensation paid to any service provider — including an investment provider, manager or adviser — be reasonable. Read more