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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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Multiple Employer Plans | Provider Shopping | Fiduciary Responsibility

How MEPs Signal a Broken 401(k) Industry

By: Eric Droblyen
October 30th, 2019

According to AARP, Americans are 15 times more likely to save for retirement when they are covered by a workplace retirement plan. However, while most large businesses – companies with more than 100 employees – sponsor a retirement plan, 51 to 71 percent of small businesses don’t. Causing many small business owners to steer clear of 401(k) plans, in my view, is a perception that plan sponsorship is too expensive, time-consuming, and/or fraught with liability – in short, not worth the trouble. To help overcome this perception – and close the small business coverage gap – I think we need more straightforward and transparent 401(k) plans.

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Multiple Employer Plans | Thought Leadership | Fiduciary Responsibility

TSP-like 401(k)s + Tax Credits = More Small Business Plans

By: Eric Droblyen
October 3rd, 2018

According to AARP, Americans are 15 times more likely to save for retirement when they can do so by payroll deduction through a 401(k) or other workplace retirement plan. However, while most large businesses – companies with more than 100 employees – sponsor a retirement plan, 51 to 71 percent of small businesses don’t. In recent years, Multiple Employers Plans (MEPs) have been floated as a way to close this small business coverage gap. I disagree for a simple reason - MEPs fail to address the specific reasons why small businesses don’t offer a retirement plan today. I think single-employer 401(k) plans modeled after the Federal Thrift Savings Plan (TSP) paired with tax credits would do a better job.

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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 | Thought Leadership | Fiduciary Responsibility

How Trump’s Executive Order on Retirement Plans Falls Short

By: Eric Droblyen
September 19th, 2018

On August 31, President Trump signed an Executive Order on Strengthening Retirement Security in America.  In the order, the President made it the “policy of the Federal Government to expand access to workplace retirement plans for American workers.” While I fully support the policy – not enough workers are covered by a workplace retirement plan – I don’t think the order’s proposals will motivate more employers to offer a retirement plan. Other changes would be more effective.

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low cost 401(k) plan | 401(k) Fees | Multiple Employer Plans

Why Multiple Employer 401(k) Plans are Obsolete Today

By: Eric Droblyen
December 13th, 2017

A couple of weeks back, I found a Multiple-Employer 401(k) Plan (MEP) marketing piece by State Street Global Advisors (SSGA) that copied (without attribution) a 401(k) plan fiduciary hierarchy I had created for a blog. The piece claimed employers could fully outsource their plan’s hierarchy – and any personal liability for failing to meet its fiduciary responsibilities – to a MEP 401(k) provider. The problem? While outsourcing the 401(k) hierarchy is possible, outsourcing its liability is not.

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Multiple Employer Plans | Thought Leadership | Fiduciary Responsibility

401(k) Cybercrime – Key to Keeping a Plan Safe Is Not Delegating Fiduciary Responsibilities

By: Eric Droblyen
September 20th, 2017

Two weeks ago, Equifax – one of the country’s biggest credit reporting agencies – announced that its systems were hacked by cybercriminals, exposing the Social Security numbers, birth dates, addresses, and driver's license numbers of 143 million Americans. Unfortunately, this huge data breach was not unprecedented. The personal information for 1 billion Yahoo users and 145 million eBay users was exposed in 2013 and 2014, respectively.

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Multiple Employer Plans | Provider Shopping

You Want to Terminate Your Multiple Employer 401k Plan? Good Luck with That

By: Eric Droblyen
November 2nd, 2016

Small business 401k plan terminations can happen for reasons other than going-out-of-business or a business sale.  Sometimes, even successful businesses decide to terminate their plan due to a cash crunch or poor employee participation.

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