ADMIN Partners is committed to creating educational opportunities for both our existing and potential clients. We understand that by educating our clients, we create a stronger relationship with them and they in turn, are more successful at maintaining their retirement plan. The benefits of having an informed Plan Sponsor is extraordinary when it comes to effective plan management. This is why ADMIN Partners decided to create a three-part series outlining why all plan sponsors should be informed. Part two takes a deeper look into the responsibility of the Plan Sponsor and the importance of the Sponsor’s role when it comes to the success of the Plan.
Having the assistance of a financial advisor and/or a full-service TPA (like ADMIN Partners) is a great asset for any plan. It allows Plan Sponsors to have the necessary support on both the investment and on the compliance sides. However, these additional services do not mean that a Plan Sponsor is without any responsibility. In fact, most Plan Sponsors are unaware that regardless of a TPA or advisor’s involvement, they can often still hold full fiduciary responsibility of the plan (keep in mind that this will always be dependent on your plan design as some firms will accept responsibility in place of the Plan Sponsor.)
In a recent document from the United States DOL (which you can read here) the responsibilities a Plan Sponsor will assume are listed as: Acting solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them; Carrying out their duties prudently; Following the plan documents (unless inconsistent with ERISA); Diversifying plan investments; and Paying only reasonable plan expenses. This list places a lot on the arms of the Sponsor which further validates the gravity of the Plan Sponsor’s responsibility to the Plan.
Do you have more questions about how you can better manage your retirement plan? Feel free to reach out to us anytime by calling us (toll free) at 8 7 7 – 4 8 4 – 4 4 0 0 or via email at [email protected].