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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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Plan Design | Plan Setup

Solo 401(k) Plans – Their Benefits to Self-Employed Workers

By: Eric Droblyen
May 16th, 2018

401(k) plans that only cover business owners - and their spouses – are commonly called “solo” 401(k) plans. Because they don’t cover non-owners, solo 401(k) plans aren’t subject to many of the most complex 401(k) plan qualification requirements – including annual nondiscrimination testing. That makes these 401(k) plans easy to administer while allowing plan participants to receive large annual contributions - up to the 415 limit ($55,000 + $6,000 catch-up for 2018) – without restriction. These benefits have made solo 401(k) plans a popular retirement plan choice for business owners that want to save more than personal IRAs allow.

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401k plan participation | DOL Fiduciary Rule | Financial Advice

3 Common 401(k) Provider Conflicts of Interest!

By: Eric Droblyen
May 2nd, 2018

On March 15, 2018, the Fifth Circuit Court of Appeals invalidated the Department of Labor’s (“DOL”) Fiduciary Rule in a 2-1 decision. If the DOL does not request a rehearing within 45 days, the regulation will die. If that happens, the rules for 401(k) investment advice that existed before the Fiduciary Rule will return. That means some financial advisors – basically, brokers and insurance agents - will once again be able to give conflicted investment advice by recommending high-priced 401(k) investments that pay them rich commissions over less expensive - but comparable - alternatives on May 7, 2018.

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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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401(k) Plan Coverage Testing – What Employers Need to Know

By: Eric Droblyen
April 18th, 2018

To retain their tax-qualified status, 401(k) plans must undergo extensive IRS testing each year to prove they don’t discriminate in favor of Highly-Compensated Employees (HCEs).  One of these tests is the IRC section 410(b) “coverage” test.  The purpose of this test is to ensure a 401(k) plan covers a sufficient number of Non-Highly Compensated Employees (NHCEs).  

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401k fee disclosure | DOL Fiduciary Rule

DOL Guidance for Paying 401(k) Fees from Plan Assets

By: Eric Droblyen
April 4th, 2018

One of the most common questions I get from 401(k) plan sponsors is “What 401(k) fees can I pay from plan assets?” This confusion is hardly surprising when you consider the broad range of 401(k) fees a plan can incur.

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401(k) Fees

Unpacking the Complex Web of Insurance Company 401k Fees

By: Eric Droblyen
March 21st, 2018

In a small business 401(k) fee study, we found that 7 of the top 10 most expensive 401(k) providers were insurance companies.  I can’t say I was too surprised by this finding due to the complex web of 401(k) fees charged by these companies – which can include hidden 401(k) fees that other 401(k) providers can’t charge legally and additional fees for unrelated service partners. So how do insurance companies with high 401(k) fees get away with it?  

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Form 5500

The 401(k) Form 5500 – Frequently Asked Questions (FAQ)

By: Eric Droblyen
March 7th, 2018

To meet ERISA reporting requirements, most 401(k) plans must file a Form 5500 annually.  This form is designed to disclose certain plan-related information to the Federal government and plan participants.  There are three versions of the Form 5500, each with different filing requirements. In general, the largest 401(k) plans have the most detailed - and costly – filing requirements.

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