As a fiduciary overseeing an employer-sponsored retirement plan, what do you want? Protection? Good customer service from your vendors? An easy-to-navigate retirement plan website? Education for your employees?
Go beyond the charming smiles of your vendor relationship managers and the flashy website tools or glossy print education materials. Go beyond the memorized ERISA bullet point items that begin each retirement plan committee meeting. The answer is more than these items but also more simple than these items. Ultimately and simply stated, a fiduciary wants confidence that they are providing a good plan to their employees. That’s it!
Fiduciaries need confidence that they have a good retirement plan. Confidence is obtained through clear and easy-to-understand performance reporting. If the retirement plan is performing well, you can have confidence that it is a good plan. If it is not performing well, you are faced with the brutal facts that it may not be a good plan and work is needed to improve it. A false confidence can be realized if fiduciaries are not relying on transparent performance measurements. We all want to work with vendor relationship managers that are nice and reply promptly. We all want to provide employees with good looking education materials and website tools. While items like these should be the standard service delivery of vendors helping with the retirement plan, these items do not tell you if you have a top performing retirement plan.
How do you know if you have a top performing retirement plan? Again, the answer is simple. There are three things that determine whether you’re offering a good 401(k) plan to your employees:
- Investment lineup performance
- Amount of fees charged to the plan
- Amount of income that employees are on pace to replace in retirement
Performance standards and reporting need to clearly show fiduciaries if the plan is performing in these three areas. If you want help unveiling your plan’s performance, please contact us at firstname.lastname@example.org or call 800-234-9584.