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How a Simple Calendar Can Help Retirement Plan Sponsors Prevent Liability

If your company sponsors a retirement plan, you’re probably aware of the litigation trends against retirement plan sponsors. And while initially it was only large plans getting sued, recent activity has included lawsuits against medium and small plans. So it’s important to realize that really no one is immune from problems.

All of this legal activity has occurred during a time when the US stock market has been mostly going up. As volatility increases and we eventually head toward the next bear market, it’s vital that retirement plan sponsors stay aware. Especially with some law firms out there actively prospecting for unhappy employees, we unfortunately don’t see an end to this litigation trend.

There’s also more consumer resources, such as Brightscope’s 401k rankings, that help your participants evaluate the quality and costs of your retirement plan.

For all these reasons, you want to make sure you’re doing the things that are required in a timely manner. There’s some things that attorneys can easily check for, so it’s vital that you stay current in all your compliance tasks and make sure everything is properly documented.

The Humble Calendar

One recommended best practice is to keep a formal administration calendar for your retirement plan. This should plan for and track all responsibilities that need to be performed for the plan and its participants.

While it sounds simple, it is a very easy way to illustrate that your organization takes its administration responsibilities very seriously. On the other hand, not having one, or having one that isn’t actively maintained, would infer a casual approach to administration and invite more scrutiny.

What Goes on the Calendar?

First, include all compliance tasks, big and small, on the calendar. In addition, we also recommend that you formally plan all other tasks, such as fee benchmarking, monitoring plan performance, and responding to participant feedback.
If ever called into question, having a written document showing these tasks are scheduled and completed in a consistent, organized fashion can help show you are meeting your fiduciary responsibilities.

Remember that your responsibilities may vary depending upon the type of plan you have (i.e. 401(k) or 457). It’s important to double check that you’re clear on your organization’s specific responsibilities in relation to the plan.

As a consultant to many retirement plans. we create and maintain a calendar for our clients. So if you have a plan advisor, double check that they will be taking care of this for you. However, even if you have a retirement plan advisor, you need to check the calendar regularly to make sure your organization is staying on track with its responsibilities.

Suggested Entries for Your Calendar

Here’s suggested items to make sure are on your calendar (which may vary with your plan type).

• Ensure participant notices, disclosures and government reporting are delivered
• Confirm the annual Form 5500 filing was completed
• Review nondiscrimination testing results and contribution limits
• Confirm timely deposits of all employee contributions and loan repayments
• Benchmarking of plan against other plans of similar size
• Periodic evaluations of plan service provider performance
• Review Investment Policy Statement (IPS) regularly
• Review the plan’s investment options
• Benchmark investment fees to make certain they are reasonable
• Benchmark service provider fees
• Make sure any fees paid from plan assets are reasonable and necessary

(This was an excerpt from our free eBook, How to Reduce Your Potential Liability as a Plan Sponsor.)

Download our Free EBook for More Tips

For more tips on minimizing your liability as a retirement plan sponsor, download our FREE ebook today:

  • Learn about your role as a retirement plan fiduciaryCRC eBook
  • Action steps you can take to identify any areas where you need to do more
  • How to identify and implement best practices

As potential risks rise, make sure your organization is prepared.  Invest a few minutes today to make sure you are doing all you can to prevent problems in the future.

Get Our Free eBook

Free eBook: How to Reduce your Liability as a Retirement Plan Sponsor

Low participation rates, high employee stress levels, and now increased lawsuit activity…as a plan sponsor, you have a lot to worry about.

Fortunately, you can minimize your potential liability by taking the right steps.  Get our actionable tips based on our 27 years of experience in helping plan sponsors stay out of harm’s way.

  • Learn about your role as a retirement plan fiduciaryCRC eBook
  • Action steps you can take to identify any areas where you need to do more
  • How to identify and implement best practices

As potential risks rise, make sure your organization is prepared.  Invest a few minutes today to make sure you are doing all you can to prevent problems in the future.

Get Our Free eBook

Retirement Plan Advisor Capital Research + Consulting Launches New Website

At Pasadena-based Capital Research + Consulting LLC, we’re excited to announce the launch of our new corporate website.

We’ve been in the retirement plan business since 1991, over 27 years now, serving plan sponsors nationwide.  This new website update helps people learn about our services to see if we can help them achieve their goals. The website also provides valuable education and resources to help plan sponsors better manage their retirement plans.

With over $4 billion in assets under management, we’ve learned a thing or two over the years.  So in addition to our new website, we’ve also established a new blog (blog LINK).  Here you’ll find educational articles and updates about trends and topics of interest for plan sponsors.  We encourage you to sign up for updates or follow us on social media.

Visit our new website here:

https://www.capitalresearchandconsulting.com/

 

 

 

 

Capital Research + Consulting is a retirement plan advisor to governmental, non-profit and corporate retirement plans. Our full-service, fiduciary support includes investment consulting, plan cost analysis, vendor selection services, model portfolio design and financial education for your participants.  Visit us at https://www.capitalresearchandconsulting.com/.

 

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