Broker Check

Does your 401(k) Advisor have your Back?

September 21, 2022

Does your 401(k) Advisor have your Back?

Are you currently working with a 401(k) advisor? If not, you might want to consider employing the services of a professional who has experience in managing employees’ personal retirement assets. A good amount of account holders may want to retain complete control over their account, but this is not always in the best interest of their financial security. Retirement plans are very volatile in nature, and plan fiduciaries are always acutely aware of how to adapt and strategize when conditions change. Here with Bridge Benefits Group, a big part of our job is to educate you on properly preserving your retirement funds. After all, your financial future depends on it. Here is how a trusted advisor can have your back.

What is a 401(k) Advisor?

401(k) advisors assist employers with managing the fiduciary and compliance responsibilities of sponsoring a 401(k). They assist plan sponsors with maintaining the plan, keeping it up to standard, and most importantly, they help ensure that you remain compliant with the ever-changing rules and regulations that the department of labor or IRS can enforce. These kinds of regulatory changes are hard to navigate as a plan sponsor, especially when you have daily business proceedings to deal with. When an advisor is by your side to do much of the heavy lifting, it alleviates some of the stress that comes from the process.

How an Advisor will Help Employers and Employees

Your advisor should be able to assist with a few of the following tasks:

1- Benchmarking your Plan

Benchmarking is when a company measures its own performance against similar plans. The process gives businesses the opportunity to see if their fees are reasonable, how they are performing, areas of improvement, etc. It may also provide a shortcut for staying current with management trends of retirement plans. Many elements can be benchmarked. From investment offerings to financial wellness programs, it allows plan fiduciaries to stay ahead of the game by seeing what needs to change and what can stay the same. We strongly advise that you benchmark every single year. Even the department of labor agrees that fiduciaries should treat this as an ongoing responsibility.

2- Education Seminars for 401(k) Recipients

401(k) education remains at the top of the charts for employer benefits. Employers are fully cognizant that they must offer a competitive plan to attract first-rate employees. These companies have a large stake in ensuring that their employees understand how to make the most of their plan. Employers who partner with plan advisors should always focus on retirement readiness. Continuing education guarantees that employees make sound decisions about their savings. Additionally, proper education can help to dispel some of the most common misconceptions about retirement savings.

For instance, one of the most deeply held convictions is that a retirement portfolio should be made up of the right mixture of investments, as it’s the only method for achieving your financial goals. Apart from being a myth, this belief is problematic because employees will always be in a state of despair over how to manage their retirement investing decisions. The amount of stress may cause them to do nothing and the plan recipient may rely on default investment options, or choose the wrong investments that don’t align with their goals and desires.

3- Will host Frequent Meetings to Discuss Plans

Best practice recommends that advisors and plan sponsors meet every quarter to review investment options and discuss benchmarks. But there is room to be flexible here–some meetings can take place semi-annually or annually as well. Employee driven plans require more frequent meetings in the beginning, as the plan sponsor incurs much more responsibility as a fiduciary, since they manage their employee’s money.

These meetings can cover the following:

  • Proof of investment benchmarking and proof that no further actions are necessary for the current quarter.
  • Review of market results
  • Overview of plan demographic
  • Fee and expense breakdown
  • Due diligence analysis using the IPS criteria
  • Target-date and/or model portfolio analysis

Bridge Benefits Group will Provide a 401(K) Advisor

Bridge Benefits offers an assortment of fiduciary and non-fiduciary services that include:

  • Investment Selection
  • Investment Option Replacements
  • 404(c) Assistance
  • Qualified Default Investment Alternative Assistance
  • Custom Model Portfolios

For non-fiduciary services, we provide:

  • Investment Policy Statement Assistance
  • Assistance in Identifying Plan Fees
  • Performance Reports
  • Education Services for Plan Committee
  • Participant Education
  • Participant Enrollment Support
  • Plan Search Support and Vendor Analysis
  • Benchmarking Services
  • Liaison between Plan and Service Providers

Bridge Benefits Group is proud to have helped many small to medium-sized businesses with overseeing their 401(k) plans. If you are looking for a professional group of advisors to protect your employee’s financial bandwidth, contact us today!

This information was developed as a general guide to educate plan sponsors, but is not intended as authoritative guidance or tax or legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation. In no way does the advisor assure that, by using the information provided, the plan sponsor will be in compliance with ERISA regulations.