Small Business 401(k) Blog

The Frugal Fiduciary Small Business 401(k) Blog

Get the latest industry news, deadlines and tips you need to know to help tackle your fiduciary responsibility needs.

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Provider Shopping | Fiduciary Responsibility

401(k) Annual Administration - A Checklist for Business Owners

By: Eric Droblyen
November 25th, 2020

401(k) plans are popular today because they offer generous tax benefits to employers and employees. However, to qualify for these benefits, 401(k) plans must complete a myriad of plan administration tasks each year. It’s ultimately up to employers to ensure each task is completed timely.  Meeting this important fiduciary responsibility can seem overwhelming, but it doesn’t need to be. The key is hiring a 401(k) provider that’s willing and able to do three things - 1) summarize all required tasks, 2) complete the more difficult and time-consuming ones, and 3) provide straightforward direction for completing the rest.

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Thought Leadership

401(k) Reform – How to Make Plans More Transparent

By: Eric Droblyen
November 11th, 2020

On October 27, the Ways and Means Committee Chairman Richard E. Neal (D-MA) and Ranking Member Kevin Brady (R-TX) introduced the Securing a Strong Retirement Act of 2020 to “help a greater number of Americans successfully save for a secure retirement.” In general, I like this bipartisan bill – which builds upon the SECURE Act of 2019. My favorite provision would require 401(k) plans to benchmark the investment returns of Target-Date Funds (TDFs) based on Department of Labor (DOL) standards.

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401(k) Plan Design Checklist

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Subscribe to the The Frugal Financial Small Business 401(k) Blog and receive this free checklist for help in determing the best 401(k) plan design options and fit for your company.

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Multiple Employer Plans | Provider Shopping | Fiduciary Responsibility

401(k) Fiduciary Outsourcing – Roles That MEPs Can Abuse

By: Eric Droblyen
October 28th, 2020

Providers of Multiple-Employer 401(k) Plans (MEPs) – a form of 401(k) plan co-sponsored by two or more unrelated employers - have had a rough time in the courts in recent months. Three providers - ADP, Pentegra, and TriNet - have been accused of charging excessive 401(k) fees, while two others – Insperity and National Rural Electric Cooperative Association (NRECA) - have paid out tens of millions of dollars in restitution. Because providers usually market MEPs as a lower-cost alternative to single-employer 401(k) plans, these lawsuits can seem surprising. I’m not surprised one bit.

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Retirement Planning | Thought Leadership

401(k) Retirement Planning – 4 Steps to Retire On-Time

By: Eric Droblyen
October 14th, 2020

The priciest thing that most people will buy in their lifetime is retirement. Perhaps you’ve never thought of “buying” retirement, but that’s exactly what you do when you contribute to a 401(k) plan – you’re saving now to afford income in retirement. When you consider that income may need to last 10, 20, even 30 years, it’s easy to understand why retirement is not cheap.

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Investments | Plan Setup | Fiduciary Responsibility

401(k) Investments - Options for Selecting a “Prudent” Menu

By: Eric Droblyen
September 30th, 2020

Believe it or not, ERISA imposes few fiduciary responsibilities on business owners when selecting investments for their 401(k) plan. They boil down to picking – and maintaining - enough “prudent” investments to allow plan participants to diversify their account “so as to minimize the risk of large losses.” Prudent 401(k) investments are simply funds that meet their investment objective for reasonable fees.

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401(k) Fees | Provider Shopping | Plan Setup

Small Business 401(k) Tax Credits – Including SECURE Act Enhancements

By: Eric Droblyen
September 16th, 2020

On December 20, 2019, the Setting Every Community Up for Retirement Enhancement (SECURE) Act was signed into law. The legislation made many significant retirement plan changes, including enhanced tax credits for small businesses that start a new 401(k) plan and/or add an automatic enrollment feature to any 401(k) plan. For most small businesses, these changes took effect January 1, 2020. 

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