The story arc of the 401k mimics that of software. Each release adds to and builds on features and benefits over and above those of previous releases.
Plan Sponsors
There is an out, of course, but that might eliminate the so-called âinstitutional pricingâ advantage former employees have for staying in the plan in the first place.
While retirees and near-retirees may be considering starting a small side business, many donât have any entrepreneurial experience. How might they find answers to the questions they have?
To address this requires employers to do more than having a periodic âemployee educationâ meeting. While these can help (see the previous article), more need to be done. Plan sponsors need to consider how they (and, more importantly, their service providers) deliver messages to plan participants.
Not only does the typical plan sponsor not have investing in employee education as a high priority, but they also likely donât have the wherewithal to monitor the consistency of how the provider runs the education program.
How do you solve, for example, the problem of integration between the payroll software and the 401k recordkeeperâs website?
A few years ago, this might have been classified as a common âmistake.â Again, âmistakeâ is in quotes because this is less an issue for certain plans (usually small firms or particular industries) than others.
Common mistakes. Non-believing 401k plan sponsors. How many of these have you seen? What have you done to address the dilemma of what to do when the client isnât always right?
But this rookie mistake doesnât bypass veteran plan sponsors. If theyâve grown too complacent with their plan, they may wake up one day to find out theyâve got a dinosaur on their hands.
Retirees should think for themselves and what alternatives they have regarding their retirement assets. These arenât the same as they were when they were working.
