(501) 823-4637

info@hagan-newkirk.com

For Employers

How Often Should Companies Benchmark Their Retirement Plan?

How Often Should Companies Benchmark Their Retirement Plan?

Benchmarking can protect plan fiduciaries, reduce plan fees and maintain the quality of service and advice participants deserve!

1. “How often do you shop and compare your company’s health insurance plan with other provider plans?”
2. “Do you go years before shopping and comparing your personal car insurance rates with the rates of other providers?”

“Annually” and “No” are the most frequent answers people give to these two questions. With that in mind, why would you not also shop to compare and request bids on your company’s retirement plan on a regular basis? This is what we refer to as “Benchmarking your Retirement Plan” and the Department of Labor (DOL) recommends benchmarking about every three years.

As plan fiduciaries, it is important to remember that Section Plan of the Employment Retirement Income Security Act (ERISA) imposes high standards and provides that fiduciaries gather the information necessary to assess the “reasonableness” of fees paid for services by both the company and the participants. It also highlights the amount and the quality of the services they provide are commensurate with the fees being paid. Benchmarking your retirement plan will help protect against possible fiduciary breaches, disgruntled employees, and legal hassles.

Benchmarking is not just about fiduciary protection. Plan design features and participant education have a huge impact on retirement savings for participants, contributing not only to the success or failure of their retirement readiness, but also to the overall value of a company’s retirement plan as an employee recruitment and retention tool.

Regularly benchmarking your retirement plan is not only a DOL “best practice” – it is just good business. Conducting an independent RFP can result in a thorough review of features and fees. It can, however be a time-consuming process requiring senior staff, resources and attention. We recommend plan sponsors retain an independent plan consultant (not the broker) to do a complete benchmarking analysis on the company’s behalf. A truly independent analysis will provide the plan sponsor the cleanest and most unbiased look at their present situation as well as propose multiple alternatives to consider.

In preparing to benchmark your plan, it’s important to consider the following in order to maximize the benefits:

  • Use your most up-to-date and accurate retirement plan data, including plan level and investment expenses, investment performance and services provided by your current record keeper, administrator, and plan advisor.
  • Compare the retirement plan in a relevant context: Plans of similar size, type, design, location, and industry.
  • Don’t forget to consider the value provided! It can be reasonable to pay higher fees if a plan is receiving more or higher-quality services or is attaining higher participant success measures than similar plans.

Regular benchmarking of retirement plan costs and performance can go a long way to protect plan fiduciaries, reduce plan fees and maintain the quality of service and advice participants deserve.

CLICK HERE to request a free, independent benchmarking analysis for your plan(s).

You can call us directly or visit our office too!

Hagan Newkirk  |  Plan, Invest, Live

Central Arkansas Corporate Office
6235 Ranch Drive
Little Rock, AR 72223
Phone:  (501) 823-4637
Email:  info@hagan-newkirk.com

How to Increase Your Company’s Retirement Plan Participation

How to Increase Your Company’s Retirement Plan Participation

Hagan Newkirk takes the time to educate and engage with your employees. We excel at making sure your participants are taken care of, they understand their retirement plan investment options and are able to make solid decisions for their financial futures.

Our on-site advisor, face-to-face meetings are designed to help participants evaluate their risk tolerance and help guide them towards choosing investment options that are right for them.

For individuals who have not spent a lot of time with a financial advisor it can be a daunting and intimidating process to sit down with an advisor for the first time. Hagan Newkirk advisors are thoughtful of this fact and we are highly skilled at making sure all employees are comfortable and at home talking face-to-face with us about their current financial status, their retirement goals and the retirement plan enrollment process. Hagan Newkirk financial advisors are approachable, transparent, and speak in layman terms!

Often times it’s hard to find retirement plan advisors that give extra care and attention to retirement plan participants and the financial planning process. If you’re reading this, look no further, Hagan Newkirk

Hagan Newkirk’s Retirement Plan Participant Based Service Model:Our Retirement Plan Participant On-Boarding Process
Hagan Newkirk designs and conducts engaging and educational retirement plan enrollment sessions for company work force/employees. Our effective on-boarding process is one of the biggest reasons employers in the Little Rock Arkansas area choose and trust Hagan Newkirk to provide and manage their retirement plans and investment options.

STEP 1: Hagan Newkirk works with employers to rally their employees around retirement planning! Communication is key, Hagan Newkirk gives employers creative and effective ways to promote retirement plan enrollment by providing:

  • Custom designed informational e-mails to send to employees with retirement plan enrollment meeting date(s), location(s), and time(s).
  • Custom designed retirement plan enrollment flyers and posters for the office, break rooms, bathrooms, etc.
  • Custom designed retirement plan enrollment paystub notices and/or clock-in prompt notices.
  • Any and all other creative forms of communication that are a good fit for employers to rally their employees around participating in the company’s retirement plan!

STEP 2: Hagan Newkirk advisors conduct enrollment sessions. Our goal is to effectively get employees through the financial planning process by engaging them in thoughtful dialogue, helping to determine their risk tolerance, analyzing Gap Reports, suggesting Catch-up Plan options, educating employees on investment options and finally guiding them to make the right investment choices that are a fit for them.

Hagan Newkirk presents on screen illustrations to employees in enrollment meetings. These visuals help to explain the enrollment process, any retirement plan changes that employees need to be made aware of, and/or any new investment options that are available that they might want to consider. Our advisors explain in detail how to fill out our simple 7 Question Risk Questionnaire and Retirement Plan Enrollment form. Advisors are on hand during the entire enrollment meeting, answering questions, offering knowledge and support. This encourages employees to become participants before leaving the enrollment session.
Typically, employers will see 90 – 95% of their employees successfully enrolled in retirement plan options after attending the enrollment meeting.

Ongoing Participant Level Service Efforts
Based on company’s service level agreement

1) On-site face-to-face meetings scheduled between Hagan Newkirk Advisors and Participants: Meeting invites and scheduling are managed by Hagan Newkirk, service does not require internal resources be provided by companies for inviting and scheduling ongoing service to participants. Hagan Newkirk takes care of it all.

2) Participant Retirement Planning Meeting Frequency: 1 time per year/Minimum Service Plan, 1 time per month/Maximum Service Plan. Most companies typically choose to have Hagan Newkirk provide services quarterly.

Hagan Newkirk help employees separate their emotions from their money, making it easier for them to make smart, level headed financial decisions. Meetings are 100% focused on what the participants want to talk about, helping each individual to design an “Invest, Plan, Live” financial road map!

CLICK HERE to request a free 30 minute initial Qualified Plan Consultation

If you don’t currently have a plan, we’ll discuss options.  If you already have a plan we’ll discuss how it is set-up and how we can improve it!

You can call us directly or visit our office too!

Hagan Newkirk  |  Plan, Invest, Live

Central Arkansas Corporate Office
6235 Ranch Drive
Little Rock, AR 72223
Phone:  (501) 823-4637
Email:  info@hagan-newkirk.com

Hagan Newkirk’s Unique Retirement Plan Service Model

Our Unique Retirement Plan Service Model

What is the goal for offering a Qualified Retirement Plan to your employees?

1) To attract and retain quality employees
2) To give employee’s the tools they need to achieve a dignified retirement
3) Both

No matter your answer, there is a lot at stake.  So how do you measure the success of your Qualified Retirement Plan when it comes to achieving your goal(s)?

Hagan Newkirk’s success over the past 25 years has been largely due to our passion to help companies help their employees achieve their individual retirement goals.  Our unique service model is focused on the employee.  We have found that no single step provides more value to a plan, nor has a bigger impact on its participants, than face-to-face time with participants.

Hagan Newkirk’s professional financial advisors, engage in caring and meaningful conversations with participants.  Taking the time to understand each individual employee’s circumstances first.  Then advising them, in unintimidating layman’s terms, on the steps they need to take to reach retirement successfully.

Research has shown that most participants don’t engage fully in their company’s retirement plan NOT because they can’t afford it – but because they don’t really understand it.  Large retirement vendors have done a great job of providing online tools for determining what and how one should invest, but the truth is…the vast majority of participants never utilize these tools due to not understanding them or they are simply overwhelmed by them.

Our personal, one-on-one approach helps plan participants better understand the need for contributing to their plan, diversifying their investments and staying the course over time.  Hagan Newkirk is NOT a once-a-year (at open enrollment) advisory firm.  Retirement planning is what we do!  Our unique service model puts our skilled Retirement Plan Team on-campus several times a year for ongoing education and personalized advice.

Your retirement plan, and especially your employees, are far too valuable to settle for a part-time retirement broker/banker or a 1-800-advisor offered to you by your vendor.

In addition to our Focused Service Model for employees, another significant part of Hagan Newkirk’s success is our team’s focus on you, the Plan Sponsor.  In today’s world of ever-increasing regulation, employee-sponsored litigation, changing fiduciary landscape and expanding DOL intrusion – all Plan Sponsors should consult with a full-time, retirement focused fiduciary partner.

Hagan Newkirk provides a large selection of Consulting Services, including:
  • ERISA (Employee Retirement Income Security Act) 3(21) and 3(38) Fiduciary Services*
  • Independent Fund Analysis and Investment Policy Statement Design and Maintenance
  • Ongoing, On-Campus and On-line Employee Retirement Plan Education and Enrollment Services
  • Retirement Plan Design Review and Maintenance
  • Contractual Service Agreement Disclosing all Fees and Services
  • Retirement Plan Benchmarking, RFP (Request for Proposal) and Retirement Plan Vendor Searches at No Charge
  • Retirement Plan Sponsor Fiduciary Training Modules
  • Professionally Managed Investment Allocation Portfolios
  • Qualified ERISA Attorney on Your Retirement Plan Service Team

*Fiduciary services are offered in conjunction with Qualified Plan Advisors, Kansas City, MO.

The days of “going it alone” or “if it ain’t broke, don’t fix it” are over.
Hire Hagan Newkirk, we are the BEST Retirement Plan Service Team in Central Arkansas, we will help you:

  • Make the most of your Retirement Plan
  • Protect you as a Retirement Plan Fiduciary
  • Give your employees the best opportunity to enjoy their retirement years
CLICK HERE to request a free 30 minute initial Qualified Plan Consultation

If you don’t currently have a plan, we’ll discuss options.  If you already have a plan we’ll discuss how it is set-up and how we can improve it!

You can call us directly or visit our office too!

Hagan Newkirk  |  Plan, Invest, Live

Central Arkansas Corporate Office
6235 Ranch Drive
Little Rock, AR 72223
Phone:  (501) 823-4637
Email:  info@hagan-newkirk.com

How to Reduce Your Fiduciary Liability

Reducing Your Fiduciary Responsibility

Are you a fiduciary on your company’s retirement plan?
Do you know what that means for you if you are?
Do you also know that the United States is the only country that holds retirement plan fiduciaries personally liable for the investment decisions made on behalf of a company’s plan?

Hagan Newkirk would like to give you a few suggestions for reducing your fiduciary liability. But first, let’s identify what a ‘fiduciary’ is and what are their responsibilities. In general terms, a fiduciary is a person who owes a duty of care and trust to another and must act primarily for the benefit of the other in a particular activity. For retirement plans, the law defines the actions that result in fiduciary duties and the extent of those duties.

According to the IRS – many of the actions needed to operate a qualified retirement plan involve fiduciary decisions – whether you hire someone to manage the plan for you or do the plan management yourself. Controlling the plan assets or using discretion in managing the plan makes you or the entity you hire a plan fiduciary to the extent of that discretion or control. Fiduciary status is based on the functions performed for the plan, not a title. Be aware that hiring someone to perform fiduciary functions is itself a fiduciary act.

Every retirement plan has at least one person who acts as a fiduciary. In most cases, there is a team, committee or board who together act as plan fiduciaries.

So, what are the responsibilities of a fiduciary? ERISA holds fiduciaries to a very high standard. The responsibilities of a retirement plan fiduciary are as follows:
  • Acting solely in the interest of plan participants
  • Carrying out their duties with skill, prudence, and diligence
  • Following the plan documents unless they are not consistent with ERISA
  • Diversifying plan investments
  • Paying only ‘reasonable’ plan expenses

The responsibility to be prudent covers a wide range of functions needed to operate a plan. Since you must carry out these functions in the same manner as a prudent person, it may be in your best interest to consult experts in such fields as investments, plan administration and accounting. Other ways to mitigate your potential liability as a fiduciary include:

1. Develop a Process

According to the IRS, fiduciary responsibilities cover the process used to carry out the plan functions rather than the results. For example, a plan investment doesn’t have to be a “winner” if it was part of a prudent overall diversified investment portfolio for the plan. Since a fiduciary needs to carry out activities through a prudent process, you should document your decision-making process to demonstrate the rationale behind the decision at the time it was made.

2. Equip your Participants

Be sure your plan is setup to give participants control of the investments in their accounts. For participants to have control, they must have sufficient information and education on the specifics of their investment options. If properly executed, this type of plan limits your liability for the investment decisions made by participants. Prudence and knowledge are crucial in determining investment styles, share classes, performance and fees. This is an ongoing duty, not just an initial decision when the plan is established.

3. Hire a Professional

Also, according to the IRS, you can also hire a service provider or providers to handle some or most of the fiduciary functions, setting up the agreement (written) so that the person or entity then assumes liability. There are basically two types of fiduciary investment advisors under ERISA. A section 3(21) Co-Fiduciary is an advisor who provides the plan fiduciary or fiduciaries investment research and counsel but little liability in the process…since the person, committee or board is making the actual investment decision from the plan/participants. A section 3(38) full investment fiduciary assumes the responsibility and liability of developing and maintaining a fiduciary process for selecting, monitoring and replacing investments within the plan.

The DOL’s “fiduciary rule” (scheduled to take effect in April on 2017) will compel plan fiduciaries to consider one of these options moving forward.

If you would like more information regarding your liability as a plan fiduciary and how to best mitigate it – or, would like more information on the “fiduciary rule” and how it will effect your plan – please get in touch with us.

CLICK HERE to request a free 30 minute initial Qualified Plan Consultation

If you don’t currently have a plan, we’ll discuss options.  If you already have a plan we’ll discuss how it is set-up and how we can improve it!

You can call us directly or visit our office too!

Hagan Newkirk  |  Plan, Invest, Live

Central Arkansas Corporate Office
6235 Ranch Drive
Little Rock, AR 72223
Phone:  (501) 823-4637
Email:  info@hagan-newkirk.com

How to Reduce Your Fiduciary Liability

Reducing Your Fiduciary Responsibility

Are you a fiduciary on your company’s retirement plan?
Do you know what that means for you if you are?
Do you also know that the United States is the only country that holds retirement plan fiduciaries personally liable for the investment decisions made on behalf of a company’s plan?

Hagan Newkirk would like to give you a few suggestions for reducing your fiduciary liability. But first, let’s identify what a ‘fiduciary’ is and what are their responsibilities. In general terms, a fiduciary is a person who owes a duty of care and trust to another and must act primarily for the benefit of the other in a particular activity. For retirement plans, the law defines the actions that result in fiduciary duties and the extent of those duties.

According to the IRS – many of the actions needed to operate a qualified retirement plan involve fiduciary decisions – whether you hire someone to manage the plan for you or do the plan management yourself. Controlling the plan assets or using discretion in managing the plan makes you or the entity you hire a plan fiduciary to the extent of that discretion or control. Fiduciary status is based on the functions performed for the plan, not a title. Be aware that hiring someone to perform fiduciary functions is itself a fiduciary act.

Every retirement plan has at least one person who acts as a fiduciary. In most cases, there is a team, committee or board who together act as plan fiduciaries.

So, what are the responsibilities of a fiduciary? ERISA holds fiduciaries to a very high standard. The responsibilities of a retirement plan fiduciary are as follows:
  • Acting solely in the interest of plan participants
  • Carrying out their duties with skill, prudence, and diligence
  • Following the plan documents unless they are not consistent with ERISA
  • Diversifying plan investments
  • Paying only ‘reasonable’ plan expenses

The responsibility to be prudent covers a wide range of functions needed to operate a plan. Since you must carry out these functions in the same manner as a prudent person, it may be in your best interest to consult experts in such fields as investments, plan administration and accounting. Other ways to mitigate your potential liability as a fiduciary include:

1. Develop a Process

According to the IRS, fiduciary responsibilities cover the process used to carry out the plan functions rather than the results. For example, a plan investment doesn’t have to be a “winner” if it was part of a prudent overall diversified investment portfolio for the plan. Since a fiduciary needs to carry out activities through a prudent process, you should document your decision-making process to demonstrate the rationale behind the decision at the time it was made.

2. Equip your Participants

Be sure your plan is setup to give participants control of the investments in their accounts. For participants to have control, they must have sufficient information and education on the specifics of their investment options. If properly executed, this type of plan limits your liability for the investment decisions made by participants. Prudence and knowledge are crucial in determining investment styles, share classes, performance and fees. This is an ongoing duty, not just an initial decision when the plan is established.

3. Hire a Professional

Also, according to the IRS, you can also hire a service provider or providers to handle some or most of the fiduciary functions, setting up the agreement (written) so that the person or entity then assumes liability. There are basically two types of fiduciary investment advisors under ERISA. A section 3(21) Co-Fiduciary is an advisor who provides the plan fiduciary or fiduciaries investment research and counsel but little liability in the process…since the person, committee or board is making the actual investment decision from the plan/participants. A section 3(38) full investment fiduciary assumes the responsibility and liability of developing and maintaining a fiduciary process for selecting, monitoring and replacing investments within the plan.

The DOL’s “fiduciary rule” (scheduled to take effect in April on 2017) will compel plan fiduciaries to consider one of these options moving forward.

If you would like more information regarding your liability as a plan fiduciary and how to best mitigate it – or, would like more information on the “fiduciary rule” and how it will effect your plan – please get in touch with us.

CLICK HERE to request a free 30 minute initial Qualified Plan Consultation

If you don’t currently have a plan, we’ll discuss options.  If you already have a plan we’ll discuss how it is set-up and how we can improve it!

You can call us directly or visit our office too!

Hagan Newkirk  |  Plan, Invest, Live

Central Arkansas Corporate Office
6235 Ranch Drive
Little Rock, AR 72223
Phone:  (501) 823-4637
Email:  info@hagan-newkirk.com