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401k Plan Vendors Need to be Monitored

401k Plan Vendors Need to be Monitored 

401k Plan Vendors have a lot of responsibility for the success of a tax qualified retirement plan.  Control over the 401k Plan testing is one of the struggles that plan sponsors experience when plan participant information does not flow smoothly, timely and accurately.  When such challenges occur there is usually another area of the retirement plan where problems or some inefficiencies surface.  At the conclusion of a Plan Sponsor University (TPSU) Fiduciary Education Program held at University of Georgia in Atlanta, Georgia, TPSU Founder and CEO, Fred Barstein spoke with Laura, a Senior Human Resources Partner and Program attendee.  Laura is responsible for the successful flow of the retirement plan information at her firm which employs a staff of approximately 100.  Laura’s firm was experiencing slow service when requesting plan information and timely reports.  Whether your firm uses a 403b plan, a 401k plan or a defined benefit plan structure, this 401kTV video can provide the viewer the steps Laura took to rectify the poor flow of information on her firm’s retirement plan.

Full Transcript Here

Fred Barstein:
Fred Barstein with 401K TV. Just completed a TPSU program here in Atlanta. Okay if we ask you a few questions?

Laura:
Sure.

Fred Barstein:
Very good. Before we do, just a little bit about yourself, your role, and the size of your company.

Laura:
Okay. My company is about 1500 employees, but we are an umbrella company that has about 18 companies underneath.

Fred Barstein:
Oh, okay.

Laura:
But the total employee population is about 1500.

Fred Barstein:
And your role there?

Laura:
I’m a senior benefits analyst, so I spend a lot of time doing auditing of data between systems to make sure everything’s in line and in sync.

Fred Barstein:
Good. Well, today in the program you talked about student loans and what you’re doing to help the younger employees to deal with it. Tell us a little bit about that.

Laura:
Over half of our population is millennial, so their focus may not necessarily be towards retirement.

Fred Barstein:
Right.

Laura:
They’ve just gotten out of college and may have a lot of student loan debt. We have partnered with a company called Common Bond that offers services through the employer. It’s free to the employees to consolidate their loans, refinance. They can help them work on better rates so that they can save some money which then in turn should allow them to save more towards their retirement.

Fred Barstein:
Do a lot of your employees take advantage of that?

Laura:
I believe so. I don’t have exact statistics on how many have taken advantage of it, but we do have a lot that ask about it.

Fred Barstein:
Okay. Then for those who have used it, what’s the result then?

Laura:
They’re able to save, I think, on average about 200 dollars a month on their payments by consolidating because-

Fred Barstein:
200 more?

Laura:
Yeah. Because most college graduates come out today with multiple loans, private, public.

Fred Barstein:
Yeah.

Laura:
So being able to consolidate that and get a better rate allows them to save some money.

Fred Barstein:
Right, and put away.

Laura:
Yeah.

Fred Barstein:
There is that IRS private letter ruling, which is as long as they’re contributing to their student loan, they can advantage of the match. It’s not the law yet, but …

Laura:
I see it going that way at some point.

Fred Barstein:
Yeah. Hopefully [crosstalk 00:02:20].

Laura:
Maybe not as generous as [Abbitz 00:02:21] is, but …

Fred Barstein:
But still doing that, I think, is very helpful. Final question, a couple things you picked up that you may want to take back?

Laura:
Providing more education to our employees about how targeted date funds work.

Fred Barstein:
Right.

Laura:
Because I think they just take it as, oh, this is going to take me to a certain date, but they don’t really understand how it changes over time and how the investments change over time. So just providing more information about that.

Fred Barstein:
It’s simple.

Laura:
It’s simple, but complex.

Fred Barstein:
But still you need to know about it and how it works and I think it’s helpful for you, but also the employees. That’s great. Well, thanks for your time. Thanks for attending today.

Laura:
Thank you so much. I really enjoyed it.

Fred Barstein:
Thank you and thank you for watching 401K TV.

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