A good Third-Party Administrator (TPA) plays a crucial role in managing and administering retirement plans, providing a range of services that ensure compliance, efficiency, and overall plan health. One of the primary responsibilities of a TPA is to navigate the complex landscape of regulatory requirements, ensuring that clients’ retirement plans adhere to all relevant laws and guidelines. This includes preparing and filing necessary reports, conducting annual compliance testing, and keeping clients informed about legislative changes that might impact their plans. By handling these administrative and compliance tasks, TPAs allow employers to focus on their core business activities without the burden of managing intricate retirement plan details.
Beyond compliance, a quality TPA offers personalized service and strategic advice tailored to each client’s unique needs. They assist in plan design, helping employers choose the best options to meet their goals and the needs of their employees. This includes optimizing plan features such as contribution structures, vesting schedules, and eligibility requirements to enhance participation and satisfaction. Additionally, TPAs provide ongoing support through employee education, helping participants understand their benefits and make informed decisions about their retirement savings. By delivering expert guidance and proactive management, a good TPA ensures that retirement plans operate smoothly, benefiting plan sponsors and participants alike, and ultimately supporting the long-term financial wellness of all involved.
At the conclusion of a TPSU program held on the campus of the University of South Florida, Fred Barstein, founder and CEO of TPSU, spoke with Lauren, the Chief People Officer at TLC Diversified. Lauren explained that TLC Diversified, which has around 100 employees, benefits greatly from the services provided by their TPA and advisor. She emphasized the TPA’s role in maintaining compliance, handling 5500 forms, ensuring safe harbor provisions, and managing the contributions of both high and low-earning employees. Lauren also highlighted the long-standing relationship with their advisor, who has been instrumental in selecting and managing the company’s target date funds and index funds, leading to satisfactory returns for their employees.
Read the Full Transcript Here:
Fred Barstein:
Greetings. This is Fred Barstein, founder and CEO of TPSU. I’m here at the University of South Florida where we just completed a program, here with Lauren. Welcome, Lauren.
Lauren:
Hi, how are you?
Fred Barstein:
Okay if we ask you a few questions?
Lauren:
Absolutely.
Fred Barstein:
Okay. Before we do, tell our audience a little bit about yourself.
Lauren:
So my name is Lauren and I am currently the Chief People Officer at a company called TLC Diversified. And we have around a hundred employees, currently.
Fred Barstein:
A hundred employees, okay. So one of the things you talked about today in your group was that you really liked what your advisor and TPA did for you. What are some of the things they did that really help you?
Lauren:
So one of the main things that I think that our TPA provides to us and helps me out I know with, is maintaining our compliance, our 5500s and any sort of safe harbor. And just basically maintaining all compliance and making sure that we’re staying up to date with what we need to stay up to date with. And also making sure that we’re keeping track of not only our high earning and high contributing members to the fund, but also to the people that are not, maybe aren’t contributing as much, but we still need to capture the entire picture of everyone who participates in the fund.
Fred Barstein:
Right. Because how are you supposed to know all these rules and requirements?
Lauren:
Exactly.
Fred Barstein:
What about your advisor? You said your advisor too.
Lauren:
So our advisor is someone who we’ve been working with for at least the past 10 years as well. We’ve built a really great relationship with him. He has been indispensable in helping us pick what sort of index funds and what sort of, I shouldn’t say target fund that we’ve decided to choose as our main-
Fred Barstein:
Target date.
Lauren:
… target date fund that we’ve decided to implement. And we’ve been really happy with the returns on that. And most people tend to stay with the fund that they are automatically put into when they join.
Fred Barstein:
Is he accessible to your employees as well?
Lauren:
Yes, he is.
Fred Barstein:
To do that. So final question TPSU, couple of things you picked up. Would you recommend this?
Lauren:
Yeah, absolutely. Especially around the SECURE 2.0 Act, which was something that I was unfamiliar with. Obviously something that I had heard about through my TPA, but we had not gone into depth about, which I was excited to hear about today. And just learning more about just the different structures that are implemented at different companies, just to get an idea of what a 401k can be for anybody really, just for all different industries. Just really excited to see that.
Fred Barstein:
Well, thank you for sharing today. And thank you for watching 401kTV. Please stay tuned.
