There are an abundance of benefits to outsourcing the fiduciary risks and responsibilities of your company sponsored qualified retirement plan. Given the increased regulations and scrutiny by Capitol Hill, outsourcing makes sense for most small to mid sized businesses. Most business owners do not have the time to manage their retirement plan with the attention it deserves and demands. One question must be ask, if you could go back 6 years and prevent ObamaCare would you? Now is the time to do something about the qualifed retirement plan you provide.
Companies outsource many services, including payroll, auditing, marketing, legal defense, building maintenance, HR services and advertising, to name but a few. The reasons for outsourcing generally include:
- Cost savings
- Better outcomeCost savings
- Increased productivity
- Allows employees to do the things that they do best
Numerous business experts and consultants tout the benefits of outsourcing. “Do what you do best and outsource the rest,” says Tom Peters, management consultant extraordinaire. Former HUD Secretary Alphonso Jackson once stated, “When work can be done outside better than it can be done inside, we should do it.”
There is now a growing trend to outsource 401(k) services for many of the same reasons, but also because there are additional benefits in so doing, such as:
- Reduced liability
- Increased objectivity
- Fewer conflicts of interest
- Increased service level
There are numerous benefits to outsourcing the fiduciary functions of your qualified retirement plan. You are far too busy running your company to properly manage a quality retirement plan for your employees and yourself. Your broker in most cases cannot or will not accept the fiduciary risks and responsibilities of managing your company retirement plan. They are more than happy to recommend investment choices, however, you retain all risks and responsibilities.
Please comment or call to discuss to determine if outsourcing is right for your company.
- The Difference an Adviser Can Make (401kplanadvisors.com)
- Benchmarking: The Key to a 401k Plan Sponsor’s Fiduciary Compliance Review (401kplanadvisors.com)
- New Survey Reveals How 401k Plan Sponsors Rank 8 Hot Topics (401kplanadvisors.com)