Reviewing your workplace retirement plan

Tuesday, July 5, 2022 ~ Updated 8:04 AM

When piecing together your overall retirement plan, the employer sponsored retirement plan is a huge part of supplementing Social Security for retirement income. There are different employer sponsored plans available. The most popular ones offered are 401(k)s, 403(b)s, and SIMPLE IRAs. For those whose employer does not offer a retirement plan, make sure to look into starting a Traditional or Roth IRA. Any retirement plan is better than no retirement plan!

For business owners, it’s very important to review your plan every year to make sure it’s meeting the goals and objectives for you and your employees.

A review of the plan design is crucial. There are many ways your plan can be structured, so be sure it’s what’s best for your pocketbook and the employee’s best interest.

Making sure you (and your employees) aren’t overpaying for fees, whether it’s record keeping, investment, or TPA fees, etc., is also crucial to the success of the plan. These fees are easily obtainable through the Fee Disclosure document and should be readily available to any participant.

JASON T. LEE, CRPC CRPS

Submitted

Another contributor of the success of your retirement plan is having an adviser who will meet with them and answer questions and give guidance to help make sure they are on the right path to retirement. Annual reviews are important in all aspects of retirement as life happens and your needs may change, which leads to changes in your retirement plan.

The lack of understanding the benefits of the Roth option inside the 401(K) is a common mistake that I experience. Many employees are not aware if it is offered in their plan. Some don’t think they can contribute, among other misunderstandings. The ability to potentially have tax-free withdraws in retirement is very appealing for most people. It should at least be considered.

You probably offer retirement benefits to help attract and retain good employees, and it’s equally important to keep up with ongoing benefits and changes to make sure that happens.