Business Solutions Insights
Earlier this year, the Supreme Court made a landmark decision in Tibble v. Edison International* that has brought retirement planning and fiduciary obligation to the forefront of the news. As a retirement plan provider, you may be wondering how this case might affect you, your employees and your fiduciary responsibilities.
New comparability plans optimize the qualified plan benefit acting as both a powerful management tool and means of rewarding top-tier employees who are typically closer to retirement.
Business owners often struggle to balance a 401(k) benefit program that passes non-discrimination testing with also providing a compelling retirement compensation package to key employees. A New Comparability Plan is a surprisingly easy and overlooked profit-sharing plan design feature that enables employers to significantly increase the plan contribution for select employees who are key to company performance while remaining comfortably compliant. The design feature is simply built into employers’ existing plans; no new plan needs to be implemented.
Having a diligent fund analysis process has never been more important.
With the recent Supreme Court Tibble v. Edison ruling, it’s clear that employers who don’t consistently review performance and costs of retirement plan funds may be vulnerable to regulatory scrutiny, headaches and penalties down the road.