Attract, Retain, and Reward employees

Offer a 401(k)

Top talent expect retirement plans as part of their employee benefits. Providing a 401(k) or another retirement plan to employees not only provides a valuable benefit, but also helps manage tax liabilities for the company and its owners.

If you already offer a retirement plan, working with Purposeful SP might lower plan costs, offer better investment options, reduce your fiduciary liability, and provide even greater benefits to your employees.

 

Why a Purposeful SP Retirement Plan?

Although the basics of offering a retirement plan are pretty standardized, there are important difference in the benefits and protections our clients receive compared to other providers. Our plans are built on conflict-free advice, expert regulatory and tax compliance, the protection of a third-party custodian, and the opportunity to delegate company fiduciary responsibilities.

A Fiduciary & Fee-Only Advisor

To protect your plan and your company, Purposeful SP provides fiduciary and fee-only advising on the plan and the investment options. You may also delegate much of your fiduciary obligations to Purposeful SP, reducing the liability exposure to your company. (Scroll down to learn more)

Your employees also benefit from additional service including free educational webinars and personal financial planning advice without the conflicts of interest inherent in commissioned product sales. Sadly, most financial advisors are paid completely or in part through commissions, referral fees, or other kickbacks.

An Expert ADMINISTRATOR and Recordkeeper

Your plan administration, tax filings, and regulatory compliance are provided by our partner, PCS. Founded in 2001 by tax and ERISA attorneys who saw the need for a conflict-free, full fee disclosure, no hidden agenda retirement solution; PCS is a leader in retirement plan administration and recordkeeping.

A proven and strong custodian

Your plan’s assets are custodied either at Charles Schwab or TD Ameritrade, meaning your money is held at a trusted company with a long-history of protecting investors. Neither Purposeful SP nor PCS have access to plan moneys. Using a third-party custodian also means there are additional checks and balances to ensure plan money is secure, further protecting your plan and reducing company liability.


Benefits of offering a 401(k):

  • Attracting and rewarding better employees

  • Reducing income tax liability for owners and top executives

  • Increasing employee retention and productivity

  • Diversifying owner’s wealth beyond the business

  • Providing for the owners’ retirement


Proper Fiduciary Delegation can

Reduce Liability

As the sponsor of a retirement plan, your company has a fiduciary responsibility (and liability) to protect the assets of the plan for the benefit of employees. This means your company can be sued and held legally liable for problems with your retirement plan.

Fortunately, you can reduce this liability by delegating some or most of your fiduciary responsibility to a qualified advisor. Here are your options:

No Delegation - Your Company has Full Fiduciary Responsibility

Under this model, the plan sponsor (your company) makes the investment choices for the plan, functions as a prudent investment expert, ensures regulatory compliance, and retains full liability for any potential problems. A plan provider may offer a menu of proprietary insurance or mutual fund products, and may offer recommendations (not advice) from a non-fiduciary advisor, but your company is still fully liable. Many companies believe they have delegated their fiduciary responsibility to an outside company but in reality have not.

3(21): Co-Fiduciary Advisor

Your company partners with a fiduciary advisor who offers advice on the plan and in selecting investment options within the plan. This provides some protection for your company, but your company still retains liability from exercising fiduciary discretion and acting as an investment expert.

3(38): Delegation to a Fiduciary Advisor

Your company delegates authority in writing to a qualified fiduciary advisor (like Purposeful SP) who then makes discretionary decisions on the investment options within the plan. Your company can choose to fully delegate to the advisor, which shifts the company’s role from an investment expert to acting as a manager who monitors the investment expert. An advisor taking on the full 3(38) fiduciary status greatly reduces the company’s liability for investment decisions.

3(16) + 3(38): Delegation of Administrative and Investment Duties

In addition to delegating the investment decisions, your company delegates the administrative functions of the plan. This includes the regulatory compliance, tax filings, and notifications required by law. Under this model, your company has reduced your fiduciary responsibility to managing and monitoring plan providers (like Purposeful SP and PCS), shifting much of the liability for the retirement plan from your company to the providers you have selected.

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Take the First Step

We start with a free initial Discovery Meeting to explore how a retirement plan can help your employees, your business, and yourself.