401(k) Plan Consultant

Written by True Tamplin, BSc, CEPF® | Reviewed by Editorial Team

Updated on December 27, 2022

If you're thinking of implementing a 401(k) plan for your business, then the very thought of how to find the best plan with the best investment options and the lowest expenses may seem like a mind-boggling task.

Fortunately, there are 401(k) plan consultants that can help you to effectively navigate through the confusing maze of options and rules that make up the 401(k) plan marketplace today.

A 401(k) plan consultant can help you in many respects. The first thing that a good consultant will do is help you by first listening to your wants and needs for the plan. Then he or she can help you to focus on foundational factors, such as identifying the objectives of your plan, setting up plan operations and then maintaining and optimizing your plan for the benefit of your employees.

Plan Objectives

Before you can implement any type of 401(k) plan successfully, you must first know exactly  ant to prohibit plan participation for new employees by one year so that you can see whether that employee will be a good fit for his or her position in the long run.

Or you may want plan participation to start immediately in order to draw in more prospective employees.

There are any number of features in 401(k) plans that can be customized to your personal wants and needs, and a good consultant can help you to think things through until you know exactly what you want from your plan.

Then you can easily incorporate those features into the plan when you first set it up.

Plan Setup

Most of the customized features that you'll want to incorporate into your company's plan will be laid out in the plan document, or charter.

401(k) consultant Sapling Wealth Management lists the following features that can be altered to your liking:

  • Eligibility Criteria
  • Contributions - Deferrals, Corporate Matching, Profit Sharing
  • Vesting & Forfeitures
  • Distributions & Loans
  • Compliance & Other

Compliance Issues

The first thing that employers must realize when they establish any kind of qualified retirement savings plan is that they, along with the plan's trustee and administrator, all become plan fiduciaries.

This means that they are legally obligated to act unconditionally in the plan's and plan participants' best interests at all times.

If the employer is not qualified to evaluate the performance of the plan's investment choices, then it is obligated to hire this task of oversight out to a third party.

A good 401(k) consultant can help you to find a competent expert to do this at the best possible price.

Investment Management

A plan consultant can help your plan to find and use competitive investment offerings and can also assist in the process of monitoring the investment offerings on an ongoing basis.

Every 401(k) plan has to have at least three separate investment choices, and some plans have dozens.

A good plan consultant can help you to separate the wheat from the chaff when it comes to investment selection.

Cost Cutting

A good plan consultant can also help you to minimize expenses related to administering your plan. He or she can spot features or benefits that are being underused or ignored by plan participants and help you to either change or eliminate them.

Plan consultants can also help your business to streamline your plan and seamlessly integrate it into your payroll, thus saving your HR officer or department a great deal of time and effort.

A good plan consultant can help you implement the 401(k) plan that you want in every step of the way.

From establishment to operations and record-keeping, your consultant may become one of your business's most trusted advisors.

401(k) Plan Consultant FAQs

What is a 401(k) plan?

A 401(k) plan is a retirement plan offered by an employer designed to help employees save for retirement.

What is a 401(k) Plan Consultant?

401(k) plan consultants can help you to effectively navigate through the confusing maze of options and rules that make up the 401(k) plan marketplace today.

What is the difference between a Roth 401(k) and traditional 401(k)?

With a Roth 401(k), taxes are paid as money is put into the retirement account. With a traditional 401(k), taxes are paid as money is taken out.

Are there other retirement savings plans other than a 401(k) plan?

Alternatives to 401(k) plans include traditional IRAs, Roth IRAs, pension plans (if your employer offers one), and 403(b) retirement plans for employees of non-profit organizations.

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.

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