Recently, my partner Caleb Bagwell and I had the opportunity to speak to a group of Human Resource professionals about how to leverage strategic partnerships. In preparing for the presentation, I was surprised about the lack of information on how to best work with professionals you hire to perform a function for your business; i.e. best practices for working with a CPA or top tips for getting the most out of your relationship with a benefit’s adviser. So, in the spirit of not bringing up an issue without a providing a solution, here are five things that I want you to know when working with a retirement plan advisor.
1. Ask Questions – I love the ins and outs of plan design, compliance testing, and investment analytics and strive to make the details of these complicated topics as relatable and understandable as possible, but that can be difficult. Therefore, I encourage the plan sponsors that I work with and you to ask questions when you don’t understand a topic. The 401(k) plan is designed to be a benefit for you and your employees and it is imperative that you understand how it works and works for you.
2. Don’t Accept the Status Quo – I cannot tell you the number of times I’ve heard, “We’ve always done it that way.” While the old way may have worked and may still be working, there have been significant advances in plan design and participant value-adds that your plan may want to take advantage of. Your retirement plan advisor should want the best results for your plan and “the old way” should not be an excuse not explore alternative plan designs, analyze your current investment menu, or demand better a better participant experience.
3. Read the Darn Document – When I first heard this mantra, there was a stronger adjective used, but you get the idea. Why this is so important is that the plan document is the instruction manual for the plan and following it is critically important to the operation of the plan. While it seems intuitive that the plan providers would be following the document, that is not always the case. Furthermore, the consequences for not correctly following it can be anything from fines to total plan disqualification.
4. Be Engaged – You know your people better than anyone else, so be engaged and let your plan adviser know what works and what doesn’t. For example, several plan providers have introduced state-of-the-art website technology, but if your employees are not computer savvy and/or prefer live interaction or attentive call center representatives, speak up and let your advisor know what is most effective for you and your team.
5. Take Your Plan Off the Back Burner – The stock market as a whole has been on an upward trend for the last several years and most everyone has benefited in their investment accounts. While I am certainly not complaining about this, it has led to 401(k) plans being placed lower on the priority list because everything appears to be going well. However, just because no one is complaining, does not necessarily mean nothing is wrong. Your plan may be in need of a fee review, investment review, or retirement readiness assessment and none of those things are going to happen if no one is paying attention to the plan.
If you would like additional insight on how to best work with a qualified retirement plan adviser, please contact me at email@example.com or by phone, 205-970-9088.