The Core Components of a 401(k) Plan.
Every plan including the good, the bad and the ugly contain aspects of the four core plan components. It is important that each core component play a significant role in a 401(k) plan composition. Lacking in any particular area reduces the value to participants, increases the burden to plan administrators and opens the door to litigation through non-compliance. It is not enough to simply offer a plan, or to send an email to participants with limited guidance, the responsibility to offer a plan in the best interest of participants is on the Plan Fiduciary, also known as the Plan Sponsor.
If we at Alpha401k were to sum it up, it would go something like this. The Four Core Components are the backbone of any healthy 401(k) plan, they must be robust, monitored and designed appropriately. Next, built upon the plan components is the process of Objectivity, Expertise and Proactiveness, because by reducing Plan Sponsor’s 401(k) administrative burden, the right focus can be placed to best help participants reach their financial goals. And all of this is accomplished under the umbrella of the Co-Fiduciary Adviser, which partners with the Plan Sponsor and Plan Participants to do what is solely in their best interest.
Many Adviser claim best intentions, some might take on a limited (and often reactionary) fiduciary standard, but most rarely live up to the Objectivity, Expertise and Proactiveness that will truly help the Plan Sponsor oversee a 401(k) plan that seeks the best interests of every participant.
The 401(k) evaluation will analyze the Core Components of a 401(k) Plan.
It is worthy to note, your company may have outgrown the original plan design and intentions. It becomes critical from a compliance and best interest perspective to evaluate the current plan structure to ensure your plan meets the primary objectives of your firm and its participants.
Through our objectivity as an Independent Certified Financial Planner(TM), our goal is to help you benchmark your plan to the industry averages. This is fulfilling part of your fiduciary responsibility as put forth by the Department of Labor.