The Secret to Plan Sponsor Success in 2015
Every morning I wake up around 6:00 a.m. Admittedly, there are a number of days in which I hit the snooze button to buy myself a few extra minutes in my cozy bed. On the days I wake up promptly, I have time to prepare for the day and I find myself to be overall more productive and well…successful. Lunch gets packed, breakfast eaten, coffee brewed, and my hair usually looks nicer. My rushed mornings often result in stress, forgetfulness, and seem generally more chaotic. Successfully operating a retirement plan is much like a morning routine; if you hit snooze, you may find yourself scrambling for more time.
Take the time to create a plan. If your plan administrator gets sick, do you have protocols in place for someone else to take-over the role? If your HR person terminates, will your new hire know the ropes? We once took on a new client who told us that they recently replaced their payroll personnel. This employee hadn’t been formally trained on the ins-and-outs of the company’s retirement plan and therefore wasn’t aware that they were supposed to make 401(k) deferrals to the plan. It took the company 6 months of missed deferrals to realize they were making a major mistake that could cost them penalties and the qualified status of their plan. The good news is, this client hired us to help them clean up the mess.
A consistent routine with proper preparation is the secret to a successful year for plan sponsors. Review your plan document, put together a checklist of internal protocols, and ensure your current practices are effective because you never know what kind of chaos the year might bring.