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Retirement Plan Committee Duties Include Recordkeeping Services Oversight

Retirement Plan Committee Duties Include Recordkeeping Services Oversight

Retirement Plan Committees are responsible for the oversight of many retirement plan functions. Included in these duties is the responsibility for overseeing the plan recordkeeper – who maintains asset balances and participant services.

At the conclusion of a Plan Sponsor University (TPSU) Fiduciary Education Program held at the University of Denver in Denver Colorado, TPSU Founder and CEO, Fred Barstein spoke with TPSU program attendee, Angela – who chairs her organization’s retirement plan committee.  The Retirement Plan Committee decided it was time for the organization to use a Request for Proposal process to learn if there was a recordkeeper that would provide more competitive services to the firm. View the video to learn how Angela led the retirement plan committee through the process.

Full Transcript Here

Fred Barstein:
Fred Barstein with 401k TV here at the University of Denver where we just completed a TPSU program and I am here with Angela. Welcome Angela.

Angela:
Thank you.

Fred Barstein:
Okay if we ask you a few questions?

Angela:
Yes.

Fred Barstein:
Okay, great. Thank you. So before we do, a little bit about yourself and the size of your organization?

Angela:
So, I’m Angela and I’m a Chief Financial Officer at my organization. We have about 800 employees.

Fred Barstein:
Okay, great. So Angela, today you talked about, you and actually a number in your group, talking about doing a Recordkeeper RFP. For our audience that doesn’t really understand that. What is a Recordkeeper RFP?

Angela:
So, the Recordkeeper RFP, I am the chair of our-

Fred Barstein:
Request for proposal.

Angela:
Request for proposal, I am the chair of our investment committee and the recordkeeper is the organization that maintains all of our assets.

Fred Barstein:
Sure.

Angela:
And what the investment committee decided we would do is go out there and see what other recordkeepers would offer. We did a formal process.

Fred Barstein:
Sure.

Angela:
We had been with the same recordkeeper for over 30 years and it was time just to see what else was out there.

Fred Barstein:
Right. And so what was the benefit? Tell us a little bit about the whole process.

Angela:
So, the whole process, we actually had an investment advisor consulting us along the way.

Fred Barstein:
Yeah.

Angela:
And it enabled us to go through the entire, we have a 403B plan, but our entire plan and the process.

Fred Barstein:
Sure.

Angela:
So, we ended up looking at all of our investment options for the employees, we really dug into all of the fees so that we could really understand the fees and where they were coming from. We also looked through all of the services that the recordkeeper provides and so going through the record, the request for proposal process enabled us to really get an understanding of our plan soup to nuts and where we might be able to do things better, differently and also what our current recordkeeper was providing for us.

Fred Barstein:
How long did it take you? The process?

Angela:
The full process took over a year.

Fred Barstein:
Over a year.

Angela:
We started with our investment policy statement, making sure that that was sured up and where it needed to be and then the next step is then going from there, then we looked at appropriate recordkeepers and so the entire process ended up taking about a year to do.

Fred Barstein:
Right. Did you have to pay the investment consultant to do that for you?

Angela:
We did. It was also part of her regular-

Fred Barstein:
She does that-

Angela:
She does that as part of the work for us.

Fred Barstein:
The advisor on the plan.

Angela:
We did pay an additional amount because there was a lot of additional time…

Fred Barstein:
Sure.

Angela:
… But it wasn’t astronomical.

Fred Barstein:
Right. Great. So, final question. A couple of things you learned or things you want to try to take back and you’re the CFO and the head of the committee. Right?

Angela:
Yeah. We ended up finding that the end result is we have a plan that we feel confident that it provides a good list of options for our employees.

Fred Barstein:
Sure.

Angela:
We feel that our employees are paying fair and reasonable expenses…

Fred Barstein:
Sure.

Angela:
… And it’s much more transparent and we feel like we have a more comprehensive plan and most importantly, we really feel that we have a really solid process going forward and-

Fred Barstein:
You have a greater understanding of how-

Angela:
Much better understanding of all of the details.

Fred Barstein:
All right, well good. Well, thank you for your time today.

Angela:
Certainly.

Fred Barstein:
And we love to have CFOs here because we want to encourage all of our CFOs to participate in the 401k or 403B in your case, with their plan. So, that’s great. So, that’s nice to see you, nice to meet you and thank you for watching 401k TV. Please stay tuned.

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