As sponsors of pension plans and other kinds of retirement saving plans like 401K, companies and business owners are responsible for making sure that their plans conform to the Federal Law, and that includes the ERISA or the Employee Retirement Income Security Act. Majority of businesses depend on other professionals to advise and aid them when it comes to their employee benefit plan obligations. Because of this reason, it is important to choose competent service providers and this is among the relevant responsibilities of the plan sponsors, and that includes selecting a 401K investment manager. Please check http://www.theplatinum401k.com/ for more information.
In order to become great of help for companies and business owners in doing their duties and responsibilities under the ERISA to deliberately choose and monitor plan service administrators, the Employee Benefits Security Administration has givens certain guidelines which may help in choosing one.
- Companies and business owners should consider the services that they require for their plan, such as accounting, legal, custodial/trustee, recordkeeping, investment advice, investment education, and investment management.
- When they come across to multiple service providers, companies and business owners should ask questions regarding their services. They should as well scrutinize the plans administrators’ experiences in terms of employee benefit plans, expenses and fees. They should not also forget about acquiring customer references or any other info that relate to the quality of their services, as well as customer satisfaction with those services.
- Once in the point of having a list of prospective plans administrators, companies and business owners should present each and every one of them similar and complete info about thes requirements of their plan. They may want to acquire formal bids from those prospective plans administrators which seem best suited to their requisites.
- Companies and business owners may as well wish to take into consideration service providers or the alliances of the providers that render multiple services, for instance, custodial trustee, advice, investment advice, education, management, so as recordkeeping but only for a single fee. These kinds of arrangements are referred to as bundled services.
- Inquire to every prospect plans administrator to be specific regarding which services will be covered by the estimated fees and those that are not included. Companies and business owners should then compare all of the information that they receive, and that includes expenses and fees to be charged by the different administrators for the same services. It is also important to take note that the plan trustees are not always mandated to select the least expensive provider. As highly cognizable, when it comes to searching for a service provider, cost is only among the factors that must be considered, but not necessarily the most important one.
- Companies and business owners should choose a plans administrator that has a fidelity bond. This is a type of insurance which safeguards the plan against loss due to dishonest or fraudulent acts.
- If the plans administrator is consisted of licensed individuals, for instance, investment managers, accountants, or attorneys, companies and business owners should check with the licensing authorities, either state or federal, to verify that the administrator has an updated license or to check if there are any complaints that are pending against the plans administrator.
Companies and business owners should follow these tips to ensure that they will hire the right 401K investment manager.