Retirement planning is more than just an employee benefit — it’s a commitment to the future for your business and your employees. As a retirement plan sponsor, your commitment comes with many fiduciary responsibilities and administrative tasks that are time-consuming and complex.
While you work to support your employees’ financial health, you also run your business and manage other company benefits. That’s why more companies like yours are turning to 3(16) fiduciary services providers for help.
What are Comprehensive 3(16) Fiduciary Services?
A Definiti 3(16) Plan Administrator steps in to provide comprehensive 3(16) fiduciary services. They act as your dedicated partner and a co-fiduciary of the retirement plan. The Plan Administrator handles many complex tasks that you, as a plan sponsor, would otherwise manage. These responsibilities require precise knowledge of regulations and timely action. For example, they prepare, sign, and submit the Form 5500.
By partnering with Definiti, you ensure your organization follows all the latest retirement plan rules. You gain expert help to make your plan work better and more reliably. And you’re not stuck with the burden of compliance audits or the hassle of managing participant notices.
For many businesses, especially smaller ones, having comprehensive 3(16) services isn’t just helpful — it’s essential. Running your business and managing a retirement plan simultaneously is tough, especially when mistakes can be costly.
When you hire a Plan Administrator, you can focus on your main job. You’ll have peace of mind knowing an expert is taking care of your retirement benefit with comprehensive and complete fiduciary services.
How a 3(16) Plan Administrator Provides Back Office Support
- Takes care of paperwork: The 3(16) Plan Administrator manages day-to-day tasks like checking who’s eligible and approving loans and distributions. This frees you to focus on your business.
- Plan compliance: A comprehensive 3(16) co-fiduciary will sign and file important documents like Form 5500 on time and accurately. This helps you avoid fines and stay up-to-date with changing laws.
- Reduces your risk: The 3(16) Plan Administrator helps protect you from potential issues by acting as a co-fiduciary for the plan.
- Employee notices: The Plan Administrator can send out all the important plan notices to your staff about the retirement plan, keeping everyone informed.
- Error correction and process improvement: If something goes wrong, the 3(16) Plan Administrator will find it early before it becomes a bigger problem.
Definit’s 3(16) Services: Helping Businesses Big and Small
More and more companies are choosing 3(16) services, and it’s easy to see why. Business owners from all kinds of industries, with retirement plans of all sizes, see the benefit of having an expert to oversee their plan’s day-to-day tasks.
For example, one Definiti client is a light fixture store with 12 participants in their retirement plan. The store’s owner was swamped with running their business — helping customers, ordering stock and managing staff. On top of that, they had to deal with complex retirement plan tasks like approving withdrawals and handling special orders for divorces (QDROs). It was just too much.
By adding our 3(16) plan administration services, the owner could hand over these time-consuming jobs to us. As their co-fiduciary, we took care of many retirement plan-related tasks, giving the store owner more time to focus on their business.
Another example of a Definiti client is a law firm with five participants in the plan. As lawyers, this firm knows all about risks. They saw the value in having a partner to help protect them from retirement plan mistakes. Definiti ensures their plan follows all the rules, like sending out participant notices and uploading payroll to the recordkeeper on time. Our services let the lawyers focus on what they do best — practicing law. (Get to know two more fiduciary service clients — a global plastics manufacturer and a construction industry client — here.)
When Definiti joins your retirement plan team as a 3(16) Plan Administrator, you get expert help and protection against common plan mistakes. Your financial advisor gets valuable support. And everyone saves time and reduces risks when the retirement plan runs more smoothly and effectively.
It’s More Affordable Than You Think
When managing retirement plans, plan sponsors may be concerned about the costs associated with outsourcing administrative and fiduciary responsibilities, but it’s a cost-effective solution.
For example, the annual 3(16) administration fee for a retirement plan with 2 million dollars in assets and 40 participants is less than $300 a month. That’s an incredible value compared with the cost of a full-time — or even part-time — HR employee to take on the plan responsibilities. Plus, you get the added protection of a retirement plan expert to keep your plan healthy.
This investment frees up valuable time you can redirect toward core business activities. As one plan sponsor told us, their small, two-person HR staff is enjoying a lightened administrative load with virtually all fiduciary responsibilities outsourced — allowing them to focus on more strategic tasks and employee engagement.
A 3(16) Plan Administrator is the Perfect Match if You Have:
- Too little time or not enough personnel to monitor payroll contributions or complete tasks
- More than 15 full-time employees participating in the plan
- Seasonal workers or if you experience high employee turnover
- Never administered a retirement plan before or are newer to a plan sponsor’s responsibilities
- Too many participant loans to keep track of
- Failed compliance testing in the past
- Submitted a corrective filing for a DOL issue
Financial Advisors Benefit From 3(16) Plan Administration, Too
Our 3(16) fiduciary services don’t just help businesses — it’s also great for financial advisors.
Advisors like our 3(16) service because it takes work off their clients’ plates and adds another retirement plan expert to the team. The Plan Administrator ensures tasks are done correctly and on time, letting advisors focus on giving investment advice. The retirement plan runs smoother, and advisors get fewer urgent calls about administrative tasks.
In short, our 3(16) services help financial advisors better support their clients. They can spend more time on meaningful work, like giving strategic advice, instead of answering questions about running the plan. It’s a win-win situation that enhances the value financial advisors bring to their clients and improves the overall management of their retirement plans.
We’re Here to Help
Definiti can give your retirement plan the support you need with our 3(16) services. We manage the plan for you, taking care of important tasks so you can focus on your business. Our team of experts makes sure everything is done right and on time.
If you find it hard to complete administrative tasks on time, including responsibilities like keeping track of long-term part-time employee eligibility, uploading payroll data, knowing when employees are eligible, or preparing, signing and submitting the Form 5500 on time, you may be ready to add a 3(16) Plan Administrator to your retirement experts team.
To learn more about our 3(16) services, contact your Definiti Retirement Plan Consultant (RPC) or your financial advisor for more details. If Definiti isn’t one of your trusted service providers, let’s start the conversation. Call 1-888-912-3653 or email salessupport@definiti.com.
