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COLLECTED WISDOM™ on Choosing and Monitoring Plan Providers and Advisors

Need help and insight on choosing or monitoring your 401k plan service providers and advisors? This resource will give you much of the information you need to accomplish this important task.

This archive contains not only the most current material on the topic, but also older items that are still relevant, provide background, perspective or are germane to the topic.

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Advisor RFPs: The Ultimate Guide (Webinar Recording)

As a retirement plan sponsor, advisor requests for proposals are a necessary part of fulfilling your fiduciary duty. They can also present a valuable opportunity to expand or change your retirement plan offerings. However, it's no secret that the RFP process can be daunting. In this webinar recording, CAPTRUST presents a step-by-step guide to aid you in planning, preparing, and executing this important body of work.

Source: Captrust.com, April 2024

A Comprehensive Guide to the 401k RFP Process

As a plan fiduciary, you need to choose the right 401k providers to ensure the financial well-being of your employees. You must undertake a thorough Request for Proposal process to do so. The RFP will help you evaluate and compare providers based on their track record, services, fees, and other critical factors. By following a well-crafted 401k RFP process, you can establish a successful and beneficial retirement savings program that meets the diverse needs of your employees. Here is a guide to the RFP process.

Source: Cuiwealth.com, January 2024

The Struggles of Being a 401k Plan Provider

As a plan provider, there are a lot of struggles in this business and it takes a lot of confidence to overcome them. Ary Rosenbaum says, "As someone who didn’t get confidence until I got wiser and stopped listening to negative people, I can assure you that you can deal with the struggles and grow your book of business." Here are a few insights from him.

Source: Jdsupra.com, December 2023

When It's Time to "Say Goodbye" Your 401k's Financial Advisor

When it comes to the financial advisor working on a retirement plan, there are certain instances, outlined here, where a plan sponsor would be wise to say goodbye. It's very tough to say goodbye, but it beats putting the plan and company at risk to continue that relationship.

Source: Jdsupra.com, November 2023

Cybersecurity Triggers a New Paradigm in Vendor Monitoring

Data breach statistics have constantly pointed to third-party service providers being the most significant conduit for compromised personally identifiable information or personal health information. A new era in vendor monitoring has emerged to gain efficiency in the responsibility to oversee service providers.

Source: Rolandcriss.com, October 2023

Important Details About 401k Plan Providers That Employers Never Ask About

For 401k plan sponsors, there are tons of things that they may ask of plan providers they hire, but there are important questions they never ask. This article is all about those important details that 401k plan sponsors never bother to ask about but should.

Source: Jdsupra.com, October 2023

Recordkeeper Benchmarking: It's About More Than Fees

This article starts with some litigation context and then moves into practical recordkeeper benchmarking perspectives that will serve your fiduciaries and participants well. As you'll see, there are many reasons to undertake a benchmarking exercise, and the recent litigation developments help to reiterate those reasons.

Source: Qualifiedplanadvisors.com, October 2023

10 Things to Look for in Retirement Plan Administration

401k's and other retirement plans are extremely technical. But by working with a highly skilled Third Party Administrator, employers can be supported in these tasks, assured their plan is running smoothly and in compliance with ERISA and IRS regulations. Choosing the right TPA for your retirement plan is a critical decision that can significantly impact your plan's success. Here are key factors to take into consideration when choosing a TPA.

Source: Kushnerco.com, October 2023

What Does My TPA Do for Me? Top Questions to Ask Your TPA

Have you ever wondered what the third-party administrator of your retirement plan does for you? Are you at a loss for a way of figuring out if they're doing a fantastic job? You might ask them how they help you to identify and correct common errors made by businesses throughout the day-to-day administration of the plan.

Source: Benefit-Resources.com, August 2023

Factors in Hiring a 401k Plan Provider That Might Be Overrated

When it comes to retirement plan providers, there are certain factors in picking them, that are way overrated. This article is all about factors in picking retirement plan providers, that might be overrated.

Source: Jdsupra.com, July 2023

What You Need to Avoid in Hiring Providers as 401k Fiduciaries

A plan sponsor has so many things to do in running a business that they often forget that as a 401k plan sponsor, they are also a fiduciary. So to eliminate some of the burdens, a plan sponsor may want to hire a plan provider that will lessen the burden by serving in a fiduciary capacity. This article is all about the things to avoid when considering hiring plan providers as plan fiduciaries.

Source: Jdsupra.com, July 2023

What You Should Be Worried About When You "Divorce" Your 401k TPA

Often we find that what determines a good third-party administrator from a bad one is when we find out what happens when the TPA gets fired, and we start getting real. This article is all about contemplating divorcing your TPA.

Source: Jdsupra.com, June 2023

Five Things You Need to Know When Switching Recordkeepers

There are few things more disruptive to the peace or clarity of a 401k plan than a switch in recordkeepers. But a change in recordkeepers is one of those "choices" that plan fiduciaries are expected under ERISA to evaluate as a prudent expert. And so, regardless of whether the change appears to be good, bad, or inconsequential on its face, you should know five key points.

Source: Penchecks.com, February 2023

A 401k Plan Sponsor's Guide to Hiring a Financial Advisor

There are so many varieties of financial advisors that it can be confusing what you should be looking for. This article is intended to act as a guide for you as you select a financial advisor for your retirement plan or review the current advisor as part of your fiduciary responsibility.

Source: Jdsupra.com, November 2022

401k Errors That Should Require a Plan Provider Change

Change for the sake of change is a bad idea, you need a reason for it. There are certain plan errors where 401k plan sponsors should consider change and that change is a change of their plan providers. Here is a list of 401k errors that should get the plan sponsor to consider making such a change.

Source: Jdsupra.com, October 2022

401ks for Startups: How to Choose the Right Provider

Looking for a 401k for your startup? This article will help you understand everything you need to know about selecting a 401k provider designed to meet a startup's needs.

Source: Forusall.com, October 2022

Who Are the Top 403b Providers in 2022?

As a small nonprofit, there are just some things that you struggle to find the time, resources, or staff to do. Looking for a 403b provider is one of those things. As a result, many nonprofits just default to one of the larger providers. Here is a comparison chart of the larger providers.

Source: Forusall.com, September 2022

How Employers Can Transition to a New 401k Service Provider

Moving your 401k plan between providers can seem daunting. This article breaks down the services you might be switching and explains how you can prepare for the transition of each one.

Source: Benefitnews.com, September 2022

In ERISA Excessive Fee Cases, the Pendulum May Be Swinging Back in Favor of Plan Sponsors

The Oshkosh decision appears to create a favorable precedent for plan sponsors in the 7th Circuit since it narrowly applies the holding in Hughes. From the 6th and 7th Circuit, it appears that allegations have to compare the fees being charged with the quality and/or type of services being provided. Plan sponsors should review their investment lineup, compare investments under this standard, and maintain minutes of the deliberation process. Having a process-driven policy should mitigate fiduciary risk. Plan sponsors should also review their service agreements with their recordkeepers to fully understand how recordkeepers are compensated.

Source: Foxrothschild.com, September 2022

Behaviors You Should Avoid With 401k Plan Providers

Like Rodney Dangerfield, retirement plan providers don't think they get respect. They probably think that way with some of the 401k plan sponsors who use and abuse them. This article is all about the behaviors you should avoid as a 401k plan sponsor in dealing with plan providers, whether they work for you or not.

Source: Jdsupra.com, September 2022

Investments in Technology and Automation Pay Off for Retirement Plan Providers

Plan providers are making sizable investments in technology to enhance their suite of online resources to improve digital participant experiences and better connect with a younger generation entering the workforce, according to the latest Cerulli Edge -- U.S. Retirement Edition. From education-oriented designs to targeted communications, plan providers are leveraging the latest advances in digital technologies to complement or enhance human-provided services.

Source: Cerulli.com, August 2022

How to Evaluate a Retirement Plan Recordkeeper

Lawsuits and the threat of regulatory action mean plan sponsors must take special care in choosing a recordkeeper, the entity that manages and accounts for employee investments. Here are some best practices in choosing one and evaluating the incumbent provider.

Source: Hubinternational.com, July 2022

When Good 401k Plan Providers Stumble

Many great plan providers eventually go bad and are headed for a long-term goodbye. The problem is there are certain characteristics that you can see a mile away, but they can't. These are some of the ways where a good plan provider stumbles and becomes a bad provider.

Source: Jdsupra.com, June 2022

How to Choose Your Retirement Plan Providers

Selecting competent plan providers is part of your fiduciary duty as a plan sponsor. So selecting a provider must be through an actual process where you review potential providers in each area (administration, financial advisory, ERISA attorney, and auditors) before selecting one and documenting the entire method of selection. This article is about what you should consider in selecting a retirement plan provider.

Source: Jdsupra.com, June 2022

Key Considerations for Committees Seeking DC Plan Help

Plan sponsors have the tremendous responsibility of being stewards of DC plan assets on behalf of their participants. Adding to the level of responsibility is the increased fiduciary scrutiny of legislators and regulators, as well as the ongoing evolution of the retirement landscape. It is no wonder that nearly 59% of plan sponsors use an advisor. This article offers a series of themes to help committees assess a DC plan consultant partner and select one that will enhance your plan's oversight activities.

Source: Planpilot.com, May 2022

Don't Be Fooled by These 401k Conflicts of Interest

401k conflicts of interest misalign the interests of employers and 401k providers. While employers have a fiduciary responsibility to choose a 401k provider with "reasonable" administration fees and cost-efficient investments to make retirement as affordable as possible for plan participants, conflicted 401k providers have a financial incentive to push overpriced administration services and investments when lower-priced - but otherwise comparable - alternatives are available. How do employers avoid this trap? Here are four ways a 401k provider can profit unduly at the expense of plan participants.

Source: Employeefiduciary.com, April 2022

When Recordkeepers Merge

Businesses that provide recordkeeping services to defined contribution retirement plans are merging at a dizzying rate. What considerations should plan sponsors resolve when a competitor or aggregator acquires their recordkeeper or third-party administration firm?

Source: Rolandcriss.com, April 2022

When Providers Use Plan Participant Data for Purposes Unrelated to a Plan: What Employers Need to Know

There is a growing trend of using participant data to cross-sell financial products unrelated to plan recordkeeping by large recordkeepers and asset custodians of employer-sponsored retirement plans. In light of the fact that plan fiduciaries are ultimately legally responsible for the management and mismanagement of a retirement plan, this trend to use participant data may raise issues for employers in their role as plan sponsors and fiduciaries.

Source: Ogletree.com, April 2022

Understanding 408(b)(2) Disclosures

A Covered Service Provider must provide a 408(b)(2) disclosure to the retirement plan fiduciaries. This article describes what is in a 408(b)(2) disclosure, why is this disclosure necessary, and some 408(b)(2) best practices.

Source: Multnomahgroup.com, February 2022

Finding the Right TPA Partner

To perhaps state the obvious, all third-party administrators are not alike. Those differences can make or break a good working relationship, with you, and your plan sponsor clients. Here are some checkpoints.

Source: Napa-net.org, January 2022

2021 Best in Class DC Providers

From our annual survey of approximately 3,000 defined contribution plan sponsors, DC plan providers are measured and evaluated according to feedback from their clients. Major DC plan providers are rated in the various client categories they serve, and benchmark information is collected for plan sponsors to gauge their plans against their peers.

Source: Plansponsor.com, January 2022

Can Retirement Plan Service Providers Be Trusted?

Organizations that sponsor employee benefit plans are generally responsible for ensuring that their plans comply with federal law, including ERISA. Many sponsors rely on service providers to advise and assist them with their employee benefit plan duties. But service providers to retirement plans are changing their stripes. That makes the job of selecting and monitoring them more challenging than ever.

Source: Rolandcriss.com, January 2022

2021 Best Practices Conference: Outsourcing and What to Expect From Providers

A panel discussion at the virtual 2021 PLANSPONSOR Best Practices Conference focused on the critical topic of fiduciary outsourcing and what plan sponsors can expect from service providers. Experts discussed the types of outsourcing available to plan sponsors, from basic 3(16) administration services to full discretionary 3(38) investment management.

Source: Plansponsor.com, November 2021

Switching Retirement Plan Providers in a Changing Market

Considering the consolidating market for recordkeepers, one might wonder whether looking to move a retirement plan to a new service provider is worth the effort. Yet, shopping around by soliciting requests for proposals, for instance, can yield important intelligence regarding the state of pricing and the level of services being offered. For example, employers with DC retirement plans, DB pension plans, and stock-compensation plans could find opportunities to save time and money by consolidating the administration of all of those plans with one provider.

Source: Shrm.org, November 2021

DCIO Service Providers Report Significant Momentum

The average defined contribution investment-only provider's assets under management rose 30% over the 12 months leading up to June 30, aided by market gains of around 10% in just the first half of 2021, according to a new Sway Research survey. The analysis is based on surveys and interviews with 21 DCIO sales leaders and DC plan intermediaries. It shows that not all the AUM growth is the result of increasing stock prices, as two-thirds of the managers captured positive net sales during the first half of this year.

Source: Planadviser.com, October 2021

Specialist Advisers Say Cybersecurity Practices a Top Factor in Recordkeeper Selection

Nearly one-third (31%) of retirement plan recordkeepers expect to increase their cybersecurity staff, according to a Cerulli report. Industry stakeholders suggest the threat of retirement account fraud has increased in recent years, particularly during the remote work environment, Cerulli Associates says. And, even though the majority of recordkeepers act in a non-fiduciary capacity, Cerulli points out that courts have suggested that cybersecurity is a shared responsibility.

Source: Planadviser.com, October 2021

Resources to Help Identify, Manage, and Avoid Retirement Plan Vendor Conflicts

Fiduciaries are required by ERISA to monitor service providers to the plan. That includes monitoring for any conflicts of interest. This 7-page paper identifies five areas where recordkeeping vendors have tried to monetize their relationship with retirement plans: Proprietary investment management, managed accounts, IRA rollovers, annuitization, and cross-selling retail financial products. These don't constitute a conflict of interest, but whenever a recordkeeper stands to be compensated by choices made by the plan fiduciaries or plan participants, extra care should be taken.

Source: Multnomahgroup.com, October 2021

The Rules of 401k Plan Provider Engagement

Hiring a 401k plan provider isn't an easy process and there are so many mistakes that plan sponsors like you have been made. It's not like making any other decision of your own in life, because it's a fiduciary decision. As a plan fiduciary, you are responsible for the retirement assets of your employees. This article is about the rules of engagement in hiring 401k plan providers.

Source: Jdsupra.com, September 2021

Recordkeeper Consolidation Triggers Fiduciary Responsibilities

401k plan recordkeeper consolidation is proceeding at a rapid pace as a response to shrinking profit margins. If your recordkeeper is acquired, passivity is not an option for fiduciaries who are not already familiar with the buyer's business and fee structure. Fiduciaries have a legal responsibility to make sure that their plans have obtained competent services at a reasonable cost, which means that they need to take steps to determine whether staying put or finding a new record keeper is in the interest of plan participants.

Source: Rpaconvergence.com, September 2021

Changing DC Plan Recordkeepers Can Be Complex

Although DC plan services have become more standardized over the years, the process of moving from one recordkeeper to another is complex. Risks associated with a conversion include the potential for unexpected disruption to participant accounts, lengthy blackout periods, lost data, costly reconciliations, and misunderstood communications. This paper covers steps for successful implementation and management of risks, three critical components of painless recordkeeper transition, and common transition challenges.

Source: Segalco.com, August 2021

2021 Recordkeeping Survey

The annual PLANSPONSOR Recordkeeping Survey is compiled from self-reported data submitted by recordkeepers of defined contribution plans. This year's results represent nearly $9 trillion in DC assets and are estimated to account for over 90% of the total DC market, according to internal analysis based on the "2021 Investment Company [Institute] Fact Book."

Source: Plansponsor.com, July 2021

2021 Recordkeeping Survey: Seek and Find

Fifty-eight percent of sponsors surveyed for the 2021 PLANSPONSOR Plan Benchmarking Report said their organization has been using its DC plan recordkeeper for more than seven years, and another 12.3% said it has been more than five years but less than seven. So the timing may be right for these sponsors to take a fresh look at the dynamic recordkeeping marketplace and how it has changed since they last did a request for proposals. Four plan advisers give their insights, and recommendations, as to five key preliminary steps when preparing to conduct an RFP.

Source: Plansponsor.com, July 2021

Hiring an Investment Manager? Go Beyond the RFP Responses

Retirement plan sponsors and committees that are fiduciaries often ask for guidance when hiring investment professionals. The best practice is to do a formal request for proposals that target likely candidates for the job. The RFP will identify the most qualified candidates, but other, less objective factors will differentiate them.

Source: Rpaconvergence.com, July 2021

A Long Time Coming: The DOL Issues Cybersecurity Guidance

Given that the majority of plan sponsors and fiduciaries likely already have existing service providers that aid in the administration of their benefit plans, plan sponsors and fiduciaries may consider amending the applicable service agreement to include some or all of the provisions recommended here to the extent there is not sufficient contractual protection under the existing agreement.

Source: Frostbrowntodd.com, May 2021

The Problems of 401k Plan Provider Contracts

While plan sponsors now know the price of plan administration, one problem remains. The problem is the plan provider contract, and so many disputes surround the contract. Without some guidance, 401k plan sponsors may be forced to turn over plan assets or money from their pocket needlessly to a soon-to-be former plan provider because they don't have the knowledge to contest. The problem with paying plan assets needlessly to a former plan provider is that it is a breach of fiduciary duty. This article is all about plan provider contracts and what you need to know to avoid a mess.

Source: Jdsupra.com, May 2021

Cybersecurity Security Best Practices for Retirement Plan Administration

The DOL has issued guidance for plan sponsors, plan fiduciaries, plan service providers, and plan participants on best practices for maintaining cybersecurity and protecting retirement plan assets. The guidance does not focus on the cybersecurity of the plan sponsor or the plan fiduciary, but rather the duty of plan fiduciaries for the cybersecurity of plan service providers retained by the plan fiduciaries.

Source: Troutman.com, April 2021

Cybersecurity Program Best Practices

The DOL has prepared these best practices for use by recordkeepers and other service providers responsible for retirement plan-related IT systems and data, and for plan fiduciaries making prudent decisions on the service providers they should hire.

Source: Dol.gov, April 2021

The ABCs of Changing Service Providers

Are you ready for a change to your 401k plan, but concerned that moving from one service provider to another may be too daunting a task to take on? Working with a knowledgeable advisor and vendors who have well-defined onboarding processes can reward plan sponsors and participants with a better retirement plan. The points reviewed here can help you better understand the conversion process to determine whether a prospective provider is up to the task of smoothly onboarding your plan.

Source: Alliant401k.com, April 2021

How to Stay Out of Trouble as a Retirement Plan Provider

There are two types of trouble: trouble is where you get entangled in a dispute for what is right, and trouble for doing something wrong. This article is all about the second kind of trouble and the stuff you could do to avoid it and therefore sidestep harming your business.

Source: Jdsupra.com, April 2021

Ten Questions to Ask Before Signing That New Service Agreement

The author discusses 10 of the most common areas that should be scrutinized and negotiated (with the help of your legal advisor) before you sign that "standard" service agreement with your retirement plan vendor.

Source: Boutwellfay.com, February 2021

Resources to Help Identify, Manage, and Avoid Retirement Plan Vendor Conflicts

Fiduciaries are required by ERISA to monitor the services providers to their plan. This includes monitoring any conflicts of interest. This retirement plan vendor conflict resource will help you identify, monitor, and avoid any conflicts with your plan's service providers, plus a worksheet to assist in asking the right questions about potential conflicts.

Source: Multnomahgroup.com, February 2021


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