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SmartBiz offers its employees a 401 (k) retirement plan. The company wants to evaluate plan costs and features to see if improvements are possible.
That's a smart thing to do. The 401 (k) marketplace has changed a lot in recent years, and employers have many options available to them. Many employers like the "bundled" plan approach because investment management, administration, and trustee services are provided all in one package.
Other employers prefer contracting for the services they need separately with different providers.
As SmartBiz is no doubt aware, costs do vary. Over time, even relatively small annual differences in expenses can have a large impact on a company's plan operation costs or, if expenses are charged back to the plan, on the size of employees' nest eggs at retirement. SmartBiz can see how its costs compare by conducting a benchmarking study.
The quality and scope of services are also key considerations. While SmartBiz may not want to pay for a Lincoln if an Escort will do, efficiency and accuracy are critical to the success of a 401 (k) plan. The company should also consider the features employees and prospective employees may value most, such as investment flexibility.
As an employer, you want the money you spend for employee benefits to be money well spent. If the financial professionals at Shirley Shamel CPA firm can assist you or your staff in evaluating your current benefit programs, please let us know.
Client Profile is based on a hypothetical situation. The solutions we discuss may or may not be appropriate for you. Talk to us before taking any action.