Over the years, our Sales Team has received a number of questions from potential clients. However, one of the most common questions they have received is ‘why use a TPA?’ This question comes from prospects of all sizes and designs, but it is especially received by smaller organizations who want a 403(b), but have a concern when it comes to costs. To respond, we often counter these prospects with a question of our own: ‘What level of responsibility to your Plan are you willing to take?’
The level of responsibility for Plan Sponsors has continued to increase since regulations surrounding 403(b) Plans changed back in 2008. Even plans that are not subject to ERISA are finding the demands of maintaining a compliant 403(b) plan too high. From daily administrative tasks to keeping up with the regulatory changes from the IRS and DOL, Plan Sponsors are starting to devote more and more time/effort to their plan’s administration.
In Part One of this series, we are going to explore two of the four ways a TPA can alleviate these burdens from the Plan.
As time has gone on, the complexity behind the plan document for 403(b) Plans has increased. This is especially true since the IRS announced the all-new Pre-Approved 403(b) Plan which includes a new plan document and administrative appendix that can be anywhere from 7-10 pages. The responsibility to execute these documents and maintain them over the life of the plan is significant. Over the years ADMIN has seen a number of Plans with outdated documents, Plans operating outside of the document’s specifications and even Plans who cannot locate a plan document at all. A full-service TPA (like ADMIN) will not only create your organization’s document, but they will also manage the document to ensure you are never at risk of audit failure or uncertainty surrounding the operations of the Plan.
To learn more about the IRS Pre-Approved 403(b) Plan, download our FREE ebook here!
Included in the maintenance of the plan document is the requirement to stay informed on regulatory updates mandated by the IRS and the DOL. Over the last 10+ years, retirement plans have seen an upswing regarding how the plans are regulated which has increased the threat of Plans falling out of compliance. This is especially the case for plans who are also subject to ERISA or those who are self-administering. A TPA can assist the Plan by using their expertise within the retirement industry to amend the plan document as needed and keep the Plan Sponsor informed when changes in regulations are released.
Want to learn more about your responsibilities as a Plan Sponsor and how ADMIN can help relieve you of these burdens? Contact us via email at firstname.lastname@example.org or by phone at 877-484-4400, option 2.