Q. What can a retirement plan specialist do to help make my life easier?
A. As fiduciary advisors, we are your advocates and your primary retirement plan partners. We position ourselves as intermediaries to facilitate whatever needs you may have, whatever issues come up, and to help you and your employees become more successful. As specialists in retirement plans, we must serve our clients well and stay at the front edge of our industry to continue to be successful. Therefore we are committed to the success of our clients, their plans and their employees.
Q. What are the quickest and easiest ways to improve our plan?
A. Our Five Drivers of Plan Success outlines the simplest way to help you get the most “bang for your buck” based on the time and money invested in your company retirement plan.
Q. More specifically, what immediate changes to our plan can make the biggest impact for employees?
A. This is accomplished by doing something that will make a splash. It may be something as simple as changing the methodology of how communication will be delivered.
Most employees do not participate in a plan due to extraneous circumstances – their expenses are too high, they have too much debt. Providing a fresh look at education and helping employees with their life circumstances sends a strong message to employees about your commitment to them, to the plan and to the long term health of the company.
Other attention grabbers are adding auto features to the plan such as auto enrollment and/or auto escalation, adding a new match or adjusting the current match. By the way, match adjustments can be made with zero budgetary impact while increasing the impact of participant success and appreciation for the plan.
The “secret sauce” is making those changes with the optimized concepts of Behavioral Finance. For more information on plan optimization, please see our Plan Benchmarking Report.
For more on Behavioral Finance, please watch Shlomo Benartzi’s great TED Talk: Saving for tomorrow, tomorrow. To learn about high impact participant education and communication, visit our page on How to Design and Implement Behavior Changing Financial Wellness Programs.
Q. Are brokers and advisors the same thing? Are all advisors the same?
A. No. Advisors that take fiduciary responsibility for the services they provide to the plan must always act in the best interests of the plan participants. This is important because they are held to the same standard of care as those responsible for the plan at the company.
Brokers and non-fiduciary advisors are salespeople that are probably good people and may be well intentioned, but they are not incentivized to service the plan and its participants by putting their interests first and maintaining that service at the highest level and over a long period of time. Many are not specialists or experts in the ERISA plan space. They do not have the tools or acumen to keep the plan in compliance with Department of Labor guidelines. Please see our guide to plan compliance: The 401(k) Advisors Arizona Fiduciary Framework.
Q. How do I know what fees we are paying for our plan? Do I have an obligation to know?
A. If you are a plan fiduciary then, yes, you are obligated to know all fees being charged to your plan and that they are reasonable for the services being provided. We urge plan sponsors who are unfamiliar with plan fees to engage 401(k) Advisors to do what we do best— a complete fee analysis and benchmarking investigation. At a minimum, you will know where you stand and what waste exists, if any. Quite possibly, we will be able to reduce the basis point fee structure, which can result in substantial savings over the life of the plan. To gain a greater understanding of fees being charged and whether they’re reasonable for the services provided, please see our Plan Benchmarking Report.
Q. Are all plans structured with the same types of fees?
A. No. One study found that there are 37 different types of retirement plan fees. We believe in transparency and simplicity for our clients, and, frankly, for ourselves. Our Plan Benchmarking Report will give you a comprehensive review of the fees being applied to your plan.
Q. The service we receive from our current provider is not acceptable, but we don’t want to go through the time and effort to change providers. How can we make it easy?
A. Most brokers, advisors, insurance agents and bankers will tell you that they can improve your plan, but only if you move the plan to another provider. Our analysis may recommend that you stay with your plan with only minor changes. If not, we do all the heavy lifting. Our process keeps you involved but does not impose on your time or staff.
Q. How much do you charge for your services?
A. Our fees are negotiated upfront based on the scope of services provided. However, you may benefit from a straightforward plan benchmark for a simple, flat fee. As your plan advocate, we can deliver immediate value to the relationship in the compliance aspect alone.
Q. You are only in Arizona, can you still help my employees based nationwide?
A. Our firm has affiliate offices throughout the United States. However, if we initiate the relationship here in Arizona, be assured that our local team will also service your plan and employees wherever they are located.
Q. Our company has tried everything to increase participation in the plan. What can you do?
A. Our clients have found that when employees receive quality education and communication on a regular basis, participation can begin to rise. Read more here.
Q. Some employees want financial planning advice. Can you help?
A. Yes. We have financial planning advice available through our Director of Investments, Eric Sholberg. Contact us to learn more.
Q. How do we take care of highly compensated executives?
A. We know that your highly compensated employees are not able to defer the IRS tax maximum due to testing issues. There is a wide range of special tax-advantaged codes, and a corresponding number of plan solutions.
Q. Honestly, I feel alone in managing the plan. How do I build a team I can trust?
A. Consider us your resource of resources. 401(k) Advisors – Arizona can become your own 401(k) department. Be assured, we are your advocate.