Article
FAQs for effective retirement plan governance
March 21, 2025 · Authored by David DuBrava, Matt Payne
Whether you're managing a 403(b) or 401(k) plan, our FAQs provide essential insights to help you navigate the complexities of plan management. From reducing vendor numbers to ensuring compliance and educating employees about investment options, we've got you covered. Dive in to find answers to your most pressing questions and ensure your retirement plan is optimized for success.
Your organization should review its 403(b) or 401(k) retirement plan governance structure at least annually. Regular reviews help ensure that the plan remains compliant with current regulations and continues to mee the needs of your employees.
Yes, having a retirement plan committee is crucial. A committee provides oversight and ensure that the plan is managed in the best interests of the participants. It also helps in making informed decisions regarding plan investments and administration.
An IPS is important because it provides a clear framework for making investment decisions. It outlines the plan’s investment objectives, risk tolerance and guidelines for selecting and monitoring investments. This helps in maintaining consistency and accountability in the investment process.
Your organization should evaluate the plan’s administrative and investment costs, along with its performance, at least once a year. Regular reviews help identify avoidable expenses and ensure that fees remain competitive and appropriate.
The best way to reduce the number of vendors servicing your plan is to conduct a thorough review of the current vendors and their services. Identify any redundancies and consider consolidating services with a single vendor who can meet all your needs efficiently.
Your organization should assess the plan’s service providers via an RFP every three to five years.
The best way to check if your organization’s plan documents are up to date and compliant is to conduct regular reviews with the help of a qualified retirement plan advisor or legal counsel. They can ensure that your documents meet all current IRS and DOL regulations.
To ensure your plan is compliant after operational changes, conduct a comprehensive review of the plan documents and operations. Consult with a retirement plan advisor or legal counsel to identify any necessary updates or adjustments.
To manage the diverse needs of your employees effectively, consider offering a variety of investment options and educational resources. Tailor communications and education programs to address different employee demographics and preferences.
The best way to educate employees about their retirement plan and investment options is to provide regular workshops, webinars and one-on-one counseling sessions. Many service providers offer professional advice and guidance to help employees make informed decisions.
If you are not satisfied with the investment options and their performance, consider a review of the plan’s investment lineup. Work with your retirement plan advisor to identify better-performing options and make necessary adjustments.
Your organization should monitor the plan’s performance at least quarterly. Regular monitoring helps ensure that the plan is meeting its objectives and allows for timely adjustments if needed.
To streamline plan operations and reduce the time spent managing the plan, consider outsourcing administrative tasks to a third-party administrator. This can help free up your staff’s time and ensure efficient plan management.
