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advocacy community education
20
A
s a retirement plan provider, USI
Consulting Group (USICG) has
seen all sorts of issues with
401(k) plans, ranging from poor service
from the provider, investment menus
with too little choice or too much
choice, excessive fees, and low partic-
ipation to errors in calculating eligibility,
vesting, and contribution amounts to
an outright lack of a plan document.
We call a mechanic when we notice a
loud rattle or a strange smell coming
from our car; these are signs of a
potential problem. As a result, we
gather resources to identify and fix
the problem. However, what about
the lingering problems we do not
know about?
What kind of maintenance checks can
you, as a plan sponsor, perform to
identify these small issues and avoid
bigger problems that may result in
heavy fines and legal fees to fix them?
This article is written for 401(k) plan
sponsors who believe their plans have
no issues. Much like your car, it might
be about to break down; you just have
no way of telling because the signs are
not obvious. In the case of your 401(k)
plan, you may be exposed to a signifi-
cant form of operational failure that
could lead to losing the tax-favored sta-
tus of your plan.
At USICG, we believe five basic char-
acteristics will be found in a well-exe-
cuted 401(k) plan:
1. The plan offers every eligible
employee the opportunity to save as
much as he or she wants in accor-
dance with applicable regulations,
thus maximizing their retirement
saving accumulations.
Why Your Retirement Plan is Most Likely in Trouble
By Mark A. Sarlo, CEBS
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