Keep the Benefit, Eliminate the Burden

Is your 401(k) a benefit or a burden?

Offering a 401(k) retirement plan for your employees is a necessary benefit for attracting and retaining quality employees; however there has never been more regulatory pressure than there is today for employers to properly address fiduciary responsibilities and proper plan administration. Increased regulatory compliance and audit risk in recent years are creating significant complexity for employers with no comprehensive service options to minimize that burden until now.

Each business has their own set of challenges in competing today. Below are some of the challenges that have brought employers to 401k SAFE:

  • Eliminating key employee involvement in non-profit generating functions
  • Mitigating personal liability of owners and management in regards to the 401(k) plan
  • Being accountable to an expert standard for investment oversight
  • Addressing concerns with potential audits and compliance
  • Current service providers cannot address the need

401k|SAFE Services

Below are the highlighted services we provide when you outsource your 401(k) to 401k SAFE:

Fiduciary Protection

  • Serve as 3(16) Plan Administrator
  • Monitor institutional investment managers
  • Monitor ERISA 3(21) and 3(38) plan fiduciaries
  • Retain leading ERISA attorneys for plan oversight
  • Plan due diligence prior to joining to ensure plan is in compliance
  • Ongoing validation that fees and expenses are reasonable
  • Participant deferrals and Plan contributions deposited directly to institutional custodian

Plan Communication

  • Provide enrollment information to new participants and coordinate enrollment support
  • Distribute all required notices and plan documentation (SPD, Safe Harbor, SAR, etc.)
  • Secure web portal for all plan documents, quarterly investment reviews, fiduciary updates
  • Disseminate annual 404(a)(5) Fee Disclosure to participants

Plan Administration

  • Complete, sign and file annual 5500
  • Track eligibility and send enrollment packets for new participants
  • Administer distributions for terminated employee accounts
  • Administer participant loans and hardships
  • Administer defaulted participant loans
  • Flexibility with working with multiple payroll systems or providers
  • Periodically reconcile payroll data

Participant Servicing

  • Phone support for participant questions and requests
  • Review and process loan requests and hardships
  • Process requests for QDRO's
  • Process participant distributions and rollover requests
  • Assist participants with plan information and web navigation

Don't Believe Things Have Changed?

Consider the Following:
  • 2008 - U.S. Supreme Court changes legal basis for litigating 401(k) plans, allowing individuals to seek damages against plan sponsors.
  • 2009 - The Department of Labor added 1,000 audit enforcement agents, a nearly 10-fold increase in the number of agents auditing 401(k) retirement plans.
  • 2010 - DOL's enforcement division created the Contributory Plans Criminal Project (CPCP), which is the agency's first national criminal enforcement project.
  • 2012 - The fee disclosure rules, also known as the 408(b)2 regulations will take effect requiring plan sponsors to take a more active oversight role of plan fees and expenses.

Stories, Commentary and a Little News

  • Six 401(k) Myths

    In our conversations and meetings with both plan sponsors and advisors, we have found some common misunderstandings about fiduciary oversight. Below are six common myths: 1) 3(21) and or 3(38) investment fiduciaries offer a comprehensive fiduciary solution. Having an investment

  • 401k SAFE offers 3(16) with non-trustee option

    In our standard service model we have assumed both the Plan Administrator (ERISA 3(16)) role and Plan Trustee role where we also review the investment monitoring of the investment fiduciary (ERISA 3(21) or ERISA 3(38)) for the plan. Going forward

  • “Obvious Adams” and Increasing 401(k) Participation

    One of the most useful books I have ever read was written by Robert Rawls Updegraff (1916) titled Obvious Adams: The Story of a Successful Businessman. Updegraff makes a compelling case that in many cases the best solutions are right in

  • 401(k) Transition: Mapping vs. Re-enrollment

    It seems like when we take over new plans no one wants to re-enroll the participants, everyone wants to map the old funds to the new plan. In short, we have always re-enrolled the participants. Why? It’s safer; avoiding fiduciary

  • Selling that first 401(k) plan

    Bill called me the other day to ask me a couple of questions about a 401(k) plan he was in the early stages of trying to win. It hit me that it had been a year ago when we were