by Steve Stout
on March 8, 2018
Retirement Plan Fiduciary Primer
Who is a Fiduciary?
A fiduciary is a person who has a duty to act solely in the interest of plan participants and their beneficiaries, with the exclusive purpose of providing benefits to them.
What Are the Responsibilities of a Retirement Plan Fiduciary?
According to the Department of Labor (DOL)1, the basic responsibilities of a retirement plan fiduciary are:
In addition to these general principles, the DOL provides specific guidance pertaining to certain aspects of plan operations. For example, employee deferrals withheld from a paycheck must be deposited in a timely manner.
What Are Common Fiduciaries Positions?
Why Would an Plan Sponsor Outsource Fiduciary Services?
A Plan Sponsor that chooses to offer a retirement plan to their employees, automatically assumes the fiduciary responsibility of that plan. Maintaining an employee benefit plan requires the Plan Sponsor to become knowledgeable regarding many responsibilities which are not directly related to their primary business function. The Plan Sponsor deals with administrative aspects of the plan, investment options, legal issues, compliance with regulations, government reporting requirements and disclosures and participant communications, all of which take time away from running a business.
Some Plan Sponsors prefer to transfer some of these responsibilities to other parties.
By outsourcing responsibilities to skilled and specialized service providers, a Plan Sponsor can take advantage of economies of scale to reduce costs, improve employee access through technology specifically designed for retirement plans, gain greater access to knowledge and expertise of the retirement plan industry and reduce fiduciary liability by transferring risk to a third party.
Who Wants to Be a Fiduciary?
At NBS, we are experts with retirement plan outsourcing. We have been administering retirement plans for over 30 years. In our role as a Third-Party Administrator, we handle the day-to-day processes of retirement plans. We see the pitfalls for plan fiduciaries, and we administer the plan to help avoid compliance missteps. As a 3(16) Plan Administrator, we can go even further in helping you to fulfill your fiduciary responsibilities and reduce the amount of time that you spend administering the plan.
NBS is committed to delivering effective solutions for our clients. We have a proven track record of success, serving over 20,000 employers nationwide. Since 1986, we have partnered with brokers and financial advisors to help design and service benefit packages that provide tax advantages to employers and their employees.
To learn more about NBS’ fiduciary services and how they may benefit you call 801-858-0287, email firstname.lastname@example.org, or visit nbsbenefits.com/fiduciary where you can download our brochure.