The Challenge
As you review an existing plan or look to set up a new one,
it is critical to define what it is you are trying to accomplish
by offering an employer-sponsored plan. You must also define
your vision of plan success.
“The starting point for the fiduciary is to analyze
and review all of the documents pertaining to the establishment
and management of the investments. As in managing any business
decision, the fiduciary has to set definitive goals and
objectives that are consistent with the portfolio’s
current and future resources; (and) the limits and constraints
of applicable trust documents and statutes…”
Prudent Investment Practices Handbook
Fiduciary360
So what makes a retirement plan successful? The answer depends
entirely on your idea of success.
What makes an employer-sponsored plan successful
cannot be measured by investment performance or participation
rates alone.
Success depends on what objectives an employer has when establishing
the plan. It depends on how much sponsors understand about
the plan and the amount of work required from HR to manage
the plan. Success also depends a great deal on how much the
employees understand the benefit that is provided to them.
It depends on if they take advantage of the benefit and feel
like their plan is providing the resources to help prepare
them for retirement.
The Solution
Plan Sponsors need to have the goals and objectives documented
for the plan in order to monitor plan success. To help with
this step, The 401k Service Solution™ provides a method
in Course One – The Vision Session. This course helps
plan sponsors understand what the critical issues are, identify
any gaps or areas on the plan that need further attention,
and provides a documented summary of the goals and objectives
of the plan.
Take Action
Read the Education
Guide online for this step.
Complete The
Employer Report Card to identify possible shortfalls in
your plan.
Contact a PPC
in your area to provide you with a documented
goals and objectives summary and help address any gaps in your
company’s plan.
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