Benchmarking your plan means going through the process to see how your plan compares with others of similar size and/or type. Often, you will be able to compare covered services, discover your current plans’ strengths and weaknesses, and quantify the fees you are paying in order to determine whether those expenses are reasonable.

Why is benchmarking essential?

• It’s your fiduciary best practice under ERISA to perform periodic, independent plan reviews
  
• Aim to save your company and participants money
  
• Seek to improve your service providers if necessary
  
• Seek to improve outcomes and user experience
  

Regularly benchmarking your company’s retirement plan is critical to help ensure its compliance, value, and impact. We’ve narrowed the process into four steps so you can quickly assess how your plan stacks up. Follow the steps or talk to our planning professionals today.

Find out what you’re paying

Sounds simple, right? Believe it or not, 401(k) costs are not as transparent as you may have been led to believe. Plan design, what fiduciary services are covered, quality and diversity of investments, share class and hidden fees, participant experience and engagement, planning tools and training, responsive service providers are just a few considerations when comparing cost vs value. Paying too much or paying very little for the wrong service is still wasteful and inadequate.

“Price is what you pay. Value is what you Get.” — Warren Buffet

Are you satisfied you are receiving value, and are your expenses reasonable?

Levels of fiduciary support

Are you - the plan sponsor, unnecessarily exposed? Who are the named fiduciaries on your plan?

Some of your responsibilities per ERISA:

• 3(38) Picking prudent funds
  
• 404(c) Choice and diversification
  
• 3(21), 3(16) Administrative duties

Having a “big name” company providing your plan does not guarantee these fiduciary duties are being covered. Not knowing can prove very costly to the company, participants, and you - the plan sponsor.

Evaluate providers

After getting a sense of how your 401(k) stacks up to your peers (and where it could use a bit of tuning), the next step is to evaluate alternatives. Portfolio Square can help coordinate with service providers, product sponsors and vendors.

Talk to a professional

After identifying a few areas that you might want to improve, it’s best to talk to one of our advisors. Portfolio Square is independent, which means that we don’t sell proprietary products. We exist to provide comprehensive retirement plan services to small and medium-sized organizations.