SAMPLE FUND ANALYSIS
The Retirement Plan Inversion Principle
Meeting your obligations, duties, and responsibilities to the Plan, the Committee, and the company is just the beginning. Giving the participants the tools and advice they need to actively, not passively engage in the retirement plan can make all the difference in achieving positive outcomes.
One of the tools that can help is a financial coach. A guide to help participants navigate the Plan you worked so hard and diligently to make successful. It is an expertise like this that differentiate StrategIQ from other advisors and gives you peace of mind knowing that you have someone working with you on your success. Having StrategIQ available to coach you and your participants helps the overall financial wellness of participants, thereby creating better outcomes. We see that participant financial wellness is growing in importance rather than just focusing on Plan investments.
Another consideration is the makeup of the Plan's participants. How an employee interacts with the Plan can be determined on a whole host of demographic characteristics like their position, compensation, marital status, age, time at the company, retirement horizon, etc. No matter what the socio-economic situation of the participants, the Plan must perform to their needs. These are situations that StrategIQ takes into account when consulting with participants.
You've finally got your Retirement Plan performing to the participants' expectations and delivering positive outcomes. Because it is performing so well, you can leverage the Plan as an employee retention and recruitment tool.
A Retirement Plan is an essential factor when employees are considering an employment change. If the Plan is not performing and providing positive outcomes, it is least likely to influence employee retention. It could cost anywhere from 150% - 213% of the annual salary to replace highly educated management and executive positions. High turnover, especially in key employees, could get costly.
The Retirement Plan can also be a great recruitment tool for future participants. Prospective employees, especially highly educated and highly compensated executive-level positions, delve more deeply into all levels of benefits and compensation, including the Retirement Plan.
According to the National Institute for Retirement Security, Americans see retirement benefits as almost as necessary as salary.
As a Plan Sponsor, you may find it challenging to keep up with your duties and responsibilities. You're not alone. According to J.P. Morgan Asset Management, nearly 44% of Plan Sponsors don't know that they are a fiduciary. Even if you do, the legal landscape keeps changing, and you may find it challenging to keep up.
An area of significant concern is benchmarking fees. By doing so, you're creating better outcomes for participants. Do you even know how much your fees are? What if you could reduce all the fees passed on to participants? Do participants even know they're charged fees? Benchmarking can address this issue.
The sheer volume of trying to keep up with Retirement Plan responsibilities can become overwhelming. What ends up happening is that you end up just doing the bare minimum - this can leave you and your participants exposed. You also know that you're not an expert, but what you do know is that you need one.
StrategIQ can give you the fiduciary and administrative guidance you need to do it yourself. Provide tools that will allow you to evolve to the next level, where you know what you need to do to succeed. Provide a plan for your Plan. A plan that will help spread the liability to the rest of the Planning Committee, so it is all not on you.
Or you can outsource these responsibilities to us, reducing your administrative burden and transferring the fiduciary risk to us. We are your partner in your success and the success of the participants.
The Retirement Plan Committee:
Whoever makes up the Corporate Retirement Plan Committee ultimately takes on fiduciary obligations associated with their appointment to the Committee. It is essential to select committee members carefully to ensure responsibilities to the Retirement Plan are appropriately discharged.
Committee members should be expected to respect and understand ERISA's fiduciary principles, but members are not required to be experts in retirement plans or investments. Plan Committee Members were selected to participate on the Plan Committee because of their success in previous or current roles and to provide unique talents, management skills, and business perspectives. While Committee Members bring a great deal of expertise, if they do not fill the "right spot" on the Committee, their talents may be wasted. StrategIQ evaluates the strengths and weaknesses of the Committee, looking for holes, and provides direction on how members can be positioned to fill in the gaps. In our experience, many Committee Members feel that they are not adding value, and they are not alone. Many times their strengths need to be identified and applied correctly to the Committee.
Understanding and successfully executing fiduciary obligations can be a daunting enterprise for you and the Plan Committee. Keeping on top of everything the Committee needs to be compliant can be daunting, and in the end, you don't know what you don't know.
StrategIQ can help the Committee understand what is missing and provide direction on how to meet ERISA standards and in doing so, provide better outcomes for the participants.
Helping You - The Plan Sponsor
We've discussed how we support the Participants, the Plan, the Corporation, and the Committee. And now, let's discuss how we help you, the Plan Sponsor.
StrategIQ helps you by making sure that the Participants, the Plan, the Corporation, and the Committee are all taken care of, which results in you being compliant and performing as needed. The Participant up approach is the StrategIQ Retirement Plan Inversion Principle.
Changing the thinking process and beginning with the Participants and ending with you means that we are setting you up for success right from the start. Your success is directly tied to your Participants' positive outcomes; in other words, positive outcomes for YOU! Think of it this way; all of your participants are now your advocates. They support you because you support them.
For additional information on StrategIQ's business services, please click here.