Monday December 14, 2020 at 11:30AM
Let the festivities begin, even in the era of social distancing.
It’s that time of year to start the benefit selection process for 2021. Perhaps you’ve traditionally included a 401(k) plan booth at your in-person benefits fair. By doing so, you had the opportunity to encourage people to join the plan, educate them about increasing their contributions, and let them know what resources are available to help them invest wisely. This year, you may want to look for other ways, such as a virtual benefits fair, to inform employees about the plan. Here are some thoughts on how to maximize the potential of a virtual benefits fair:
- Determine the resources you have available, and how appropriate they are for your workforce. For example, do you already have a benefits website on which to launch the fair? Is your workforce tech-savvy, and do they all have online access?
- Figure out what features of previous fairs employees loved—and what you can do to replace them. For example, if people enjoyed picking up the swag offered by vendors (or you), perhaps you could arrange a charitable donation on behalf of employees based on completed enrollments or decisions. If you find yourself with extra financial resources because you won’t have to pay for event space, snacks and time off to attend, can you devote some of the savings to creating a video library explaining topics like budgeting, investing, selecting a retirement date, etc.?
Be sure to build in a sense of urgency so employees don’t procrastinate. And above all, avoid framing your virtual benefits fair as “second best.” Instead, focus on the positive aspects of the change. Get more ideas about moving your benefits fair online from SegalBenz, at https://tinyurl.com/SegalBenzVirtual.
PLAN SPONSOR’S QUARTERLY CALENDAR
- Send payroll and employee census data to the plan’s recordkeeper for plan-year-end compliance testing (calendar year plans).
- Audit fourth quarter payroll and plan deposit dates to ensure compliance with the DOL’s rules regarding timely deposit of participant contributions and loan repayments.
- Verify that employees who became eligible for the plan between October 1 and December 31 received and returned an enrollment form. Follow up for forms that were not returned.
- Update the plan’s ERISA fidelity bond coverage to reflect the plan’s assets as of December 31 (calendar-year plans). Remember that if the plan holds employer stock, bond coverage is higher than for nonstock plans.
- Issue a reminder memo or email to all employees to encourage them to review and update, if necessary, their beneficiary designations for all benefit plans by which they are covered.
- Review and revise the roster of all plan fiduciaries and confirm each individual’s responsibilities and duties to the plan in writing. Ensure that each fiduciary understands his or her obligations to the plan.
- Provide quarterly benefit/disclosure statement and statement of plan fees and expenses actually charged to individual plan accounts during prior quarter, within 45 days of end of last quarter.
- Begin planning for the timely completion and submission of the plan’s Form 5500 and, if required, a plan audit (calendar-year plans). Consider, if appropriate, the DOL’s small plan audit waiver requirements.
- Review all outstanding participant plan loans to determine if there are any delinquent payments. Also, confirm that each loan’s repayment period and the amount borrowed comply with legal limits.
- Check bulletin boards and display racks to make sure that posters and other plan materials are conspicuously posted and readily available to employees, and that information is complete and current.
Consult your plan’s financial, legal, or tax advisor regarding these and other items that may apply to your plan.
© 2020 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this newsletter are those of Kmotion. The articles and opinions are for general information only and are not intended to provide specific advice or recommendations for any individual. Nothing in this publication shall be construed as providing investment counseling or directing employees to participate in any investment program in any way. Please consult your financial advisor or other appropriate professional for further assistance with regard to your individual situation.