Providing your employees with a pension fund like plan will be the single most effective way to improve the quality of plan you offer while reducing your fiduciary risks. The Pension Protection Act of 2006 allows many incentives to improve the retirement outcomes for all Americans. Good companies will use these provisions to improve their plan and improve their competitiveness for talented employees.

6. Reduce the number of investmentoptions.Consider offering only five risk and five age-based options as the only investment option(s). Also, consider an employer-directed 401(k) plan (yes, there are employer-directed 401(k) plans), or at least one that initially defaults the employee to an age- or risk-based fund based on certain demographics. Too much choice confuses and alienates participants. Exotic investments may be dangerous in the hands of an unsophisticated employee.

This change to your retirement plan will improve your employees ability to retire with dignity. It essentially changes your plan to a pension fund like plan. Most plan participants are confused about all the choices presented them in the typical plan. They lack the knowledge and discipline to buila a successful retirement plan.

Please comment or call to discuss how this can help you and your company.