THE SEASONED GUIDANCEyour company's
retirement plan needs

As an employer and sponsor of a 401(k) plan, pension or other employee benefits, you shoulder a major responsibility. It can be a daunting task. Do you have the experience, knowledge and resources to manage and monitor it all? We do. Allow us to optimize your company retirement plan and help ease the burden.

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SUPPORTING THE NEEDS OF Corporate retirement plans

Provider search, analysis and selection

As your organization grows and evolves, your retirement plan criteria may also change. We conduct provider analysis and research as frequently as needed, and work with you to help clarify the objectives of your institution and employees. Once a provider is selected, we guide clients through the integration process for a seamless transition.

Fee and service analysis and negotiation

Our team leverages our extensive experience in working with providers to negotiate the fees and services that are best suited for your organization. We take into account your needs and corporate profile, and develop a plan that will be sustainable and beneficial for your organization and plan participants.

Documentation and record management

Proper documentation is a key factor in ensuring the long-term success of your retirement plan. We provide support for this critical piece of your fiduciary duties, helping to implement the proper technology and systems to store and maintain records and documents, while keeping them easily accessible for convenient reference as needed.

Leadership training and employee education

By providing employees with useful resources and opportunities to learn more about their plan options, you can better ensure the success of your chosen provider and the satisfaction of employees. We provide guidance and insight for your senior staff for educating employees and assisting in the on-going facilitation of your benefits package.

Raymond James is not affiliated with and does not endorse the above companies.

Benchmark your plan

Having us conduct an objective benchmarking of your plan can help you see if your plan’s design still meets your requirements. It can evaluate how your investment platform is performing compared to others, if your provider’s services are competitive, if you are meeting your fiduciary responsibilities, whether your plan participants are receiving sufficient information, and if the fees you are paying are reasonable.

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RETIREMENT PLAN GUIDANCE For institutions

Whether you’re looking for assistance in overseeing your current plan or implementing a new one, our team offers the attention and resources to guide you through every step, helping you distinguish among seemingly endless investment options, stay current with regulations and fiduciary responsibilities, as well as educate plan participants on their options.

Having partnered with institutions of varying sizes and industries, we understand how important it is to maximize plan benefits while staying tax efficient. We utilize strategies designed to ensure your plan serves both your needs as an institution, as well as those of your constituents.

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FREQUENTLY ASKED QUESTIONS And thoughtfully prepared answers
Q: What are the benefits of offering a 401(k) plan?

A: We believe offering a 401(k) plan has become a necessity to attract and retain key talent. A 401(k) is a retirement plan that allows employees to make elective salary deferrals while avoiding current taxes on that portion of their incomes. Companies may also choose to make contributions, rewarding employees with a match or profit sharing contribution – these are generally tax deductible too, but not a requirement! The 401(k) plan has become the number one savings vehicle for Americans due to the automated savings feature, powerful tax deferred growth, ability to access funds in a pinch and high contribution limits.

Withdrawals from tax-deferred accounts may be subject to income taxes, and prior to age 59½ a 10% federal penalty tax may apply.

Q: Who is a fiduciary?

A: Anyone who has or exercises discretion or control over assets of the plan is a fiduciary. This includes:

  • Plan sponsors & investment committees
  • Investment consultants, if they render investment advice
  • Investment managers, if they have the control over the management and disposition of the assets
  • TPAs (third party administrators) with discretionary authority or responsibility for plan administration

Each plan must have a named fiduciary identified in the plan document, however most fiduciaries are deemed fiduciaries, meaning that based on the facts and circumstances of their role, they are held to a fiduciary standard. Small business owners, plan administrators and other decision makers at a company may all be fiduciaries.

Q: Ok, so if I am a deemed fiduciary, what are my responsibilities?

A: According to ERISA, a fiduciary has five primary duties:

  • Act in the sole interest of participants
  • Exercise prudence in selecting suitable investments
  • Provide a diversified investment menu lineup
  • Follow all plan documents
  • Ensure reasonable expenses and avoid conflicts of interest

KEY TAKEAWAY
Fiduciaries under ERISA are held to a high standard and breach of fiduciary duty that could result in personal liability. One way to reduce the scope of fiduciary liability is to hire prudent experts, such as Corporate Advisors Group.

Q: Why should my company work with a 401(k) advisor?

A: Your fiduciary obligations to the plan and your participant are the same whether you work with an advisor or not. However, the Department of Labor encourages plan sponsors to engage “prudent experts” to fulfill their responsibilities. And while there are costs associated with hiring a 401(k) advisor, they can often times use their industry knowledge to negotiate lower recordkeeping and investment expenses driving total cost down. Now that is truly a win-win.

Q: As a retirement plan sponsor am I responsible for choosing the investments offered to my employees in our 401(k) plan?

A: One of the core fiduciary responsibilities for a 401(k) plan is the prudent selection, monitoring and diversification of the plan’s investment offerings. The standard of care is very high and requires investment expertise.

However, with respect to the selection and monitoring of investments, the appointment of an investment manager under ERISA 3(38) provides the ability to narrow the scope of your fiduciary responsibilities. You do not have to go at it alone.

The Corporate Advisors Group can take on the fiduciary responsibility of investment selection and monitoring – saving you time and offering fiduciary protection, all while benefiting your employees with thoughtful investment options.

Q: I spend all my waking hours running my business and don’t have time to run a retirement plan? Can it be outsourced?

A: Good news – you can fully outsource many aspects of retirement plan management. A discretionary investment fiduciary will select, monitor and adjust the investment lineup as appropriate. An administrative fiduciary is responsible for managing the day-to-day operation of the plan, ranging from signing the Form 5500 to interpreting the plan document and approving distributions. The only thing left for you to do is periodically monitor the service providers you hired. It is that simple.

Q: I recently read an article about a company that was sued for high fees in their 401(k) plan. I don’t think we pay any fees, could that be?

A: There are costs associated with running all 401(k) plans. However, don’t blame yourself if you don’t know what you and your employees pay. The retirement industry has historically used revenue from plan investments to cover the costs of running a plan – an opaque and hidden structure, making it difficult to measure, manage and benchmark. These costs often cover recordkeeping expenses, investment expenses and advisory expenses. The Corporate Advisors Group is committed to 100% fee transparency so our clients don’t face this challenge. Our motto – know what you pay and ensure it is reasonable compared to both the industry and services received.

Q: How can I determine if the fees my plan is paying to its service providers are reasonable?

A: If plan service providers are being compensated from plan assets, the sponsor of the plan must ensure that the fees paid for the services rendered are reasonable. The Corporate Advisors Group can perform a detailed analysis of your plan’s current costs and compare the costs with those of competing providers. The analysis will provide you with a side-by-side comparison of the plan’s various cost components. Request your no-cost, no-obligation plan benchmarking report here.

Q: How are 401(k) providers compensated today?

A: Retirement plan service providers, including 401(k) advisors and recordkeepers, can either be paid from the fees charged directly to the plan participants or plan sponsor, or from a portion of the investment management or servicing fee built into the pricing structure of a packaged product. In some cases, a combination of the methods may be used.

Q: What if our company already has a plan in place and we are just dissatisfied with the service?

A: Many of our new clients come to us with a plan already in place. We can take over the service on your current plan, typically with no additional fees or cost. We will even provide a complimentary initial plan consultation. Making this change is as simple as signing a change of agent form.

Q: What if I like our plan’s recordkeeper? Do I have to switch?

A: Absolutely not. Corporate Advisors Group can work with any recordkeeper.

Q: I have a few employees who have not made investment elections. Is it best to keep their assets in cash so that they don’t lose value?

A: While it is understandable to think that not losing money is the most prudent approach, if the goal is to meet a future retirement income need, cash will not get you there. In fact, the Department of Labor offers plan sponsors a safe harbor for choosing a “Qualified Default Investment Alternative” also known as a QDIA. As long as the sponsor documents a prudent process for choosing a QDIA, they cannot be held responsible for portfolio declines. We help our clients choose an appropriate QDIA – one that is diversified and low cost, to take advantage of this fiduciary protection.

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