#4. What steps can 401(k) retirement plan sponsors take?
Be Aware of 401(k) Plan Sponsor Compliance Issues
401(k) plan sponsors must be aware of the dangerous consequences of mismanaging their 401(k) retirement plans. While in the past it was a rarity for lawsuits to be filed against retirement plan sponsors, these days it is becoming extremely commonplace. In their fiduciary role, failure to properly administer their plans is a violation of ERISA regulations and if found guilty, the financial penalties and tarnished reputation have the potential to do irreparable damage.
401(k) Rules: Offer the Lowest Cost 401(k) Investment Options
In order to reduce their liability and heed 401(k) rules to avoid litigation, 401(k) plan sponsors must examine how their plans are set up and which investment options have been made available to their employees. Plan sponsors should make certain that the investment options being offered are the lowest cost available. Index mutual funds are the logical choice.
To learn more about steps 401(k) plan sponsors could take to follow 401(k) rules, minimize fiduciary liability and increase participant outcomes, contact one of our retirement plan consultants today.
Up Next in our Series: #5. What are index mutual funds?
This information is intended for educational purposes only and should not be construed as an offer to buy or sell any product or strategy. You should contact your Financial Advisor with questions regarding your individual circumstance.