To say that running a business can sometimes be a struggle is probably an understatement. From inventory and daily operations to employee benefits, managing each area can create its own challenges. A 401(k) Third Party Administrator (TPA) option can take some of this burden off you, while giving you greater confidence that you're providing a fair and efficient compensation package to your team.
In the simplest of terms, with a 401(k) TPA, the administrator team is there to operate on your behalf and take control of the administrative tasks associated with maintaining the 401(k) plan.
Some of the key roles include designing a plan that is compliant with the Internal Revenue Service and Department of Labor and serves as the intermediary between you (the plan sponsor) and the organization responsible for holding the assets for the plan. The TPA organization won't just perform these tasks at the onset of the plan's execution, but will continue to serve in this capacity throughout the life of the plan.
Here are some of the benefits partnering with a 401(k) TPA can provide your small business.
As previously stated, a key role provided by the TPA is to ensure that the plan's guidelines and polices are in accordance with the requirements of government agencies. Plans that don't meet these compliance guidelines aren't just at risk for cancellation, but the business owner can also face harsh penalties and fines. A TPA absolves you of this responsibility and the risks that come with these errors.
More Attractive Benefits
A business is only as good as its staff. As a business owner, you want to attract and recruit the best employees. In order to do this, you have to be offering something they can't necessarily get somewhere else. A TPA will assist you with accomplishing this by designing an attractive compensation plan that will be most beneficial to the type of employees you are trying to recruit.
On a more practical note, partnering with a TPA can take a load of stress off your plate. Without their assistance, you would be left to design the plan, maintain it, respond to employee concerns about their policy, and do a host of other tasks. Adding these responsibilities to an already long list of duties can be overwhelming. The TPA takes over these responsibilities so you don't have to.
Let a TPA organization control your 401(k) plan for a better plan, less stress, and a better outcome overall. For more information, contact local professionals like those found at Uniglobal Pension Planning LLC.