Small plans, big opportunities: talk tracks

What should you ask?

Small retirement plans can be big opportunities. Use these questions—and suggested responses—to start and guide your conversation. They’ll help you demonstrate your value.

No plan

How are you saving for retirement?

If you think about your business as your retirement plan, you aren’t alone. But banking on that – transferring to family/friends for future compensation or selling for cash – can be uncertain.

A retirement plan at your business can help with that uncertainty. It can help you diversify your assets beyond your business. And it gives you a tax-savvy way to save for your own retirement.

Your business gets a tax deduction for contributions you make as employer contributions to a retirement plan. And assets in the plan have the potential to grow in a tax-deferred manner. You can save on expenses, too. Eligible employers with a new plan can apply the start-up tax credit, based on 50% of the plan costs, for the first 3 years beginning in 2020: greater of $500 or the lesser of $250 x NHCEs eligible or $5000. Though, best to consult with your tax consultant for specifics. 

Do you know if your employees are saving for retirement?

An employer-sponsored retirement plan is an important part of a compensation package – it can impact when and how someone can retire – and where they work.

In fact, retirement plans help people have less stress about retirement:
  • Workers with a defined contribution retirement plan are far more likely to be confident in their ability to live comfortably in retirement.1
  • Additionally, 4 in 5 workers expect these plans will be a major or minor source for income for them in retirement.1 

Do employees ask about a retirement plan?

They might be hungry for one. And it might help you recruit and retain top talent. It shows that you are a stable company, and that you want to invest in and keep your employees. 

Are you worried about the time commitment?

You need to run your business. Sponsoring a retirement plan does not have to cut into your valuable time. I can help you handle the plan, and I know about other service solutions that may save you time by outsourcing human resource administrative duties and payroll in connection with your retirement plan.

Take care of the people who take care of your business. Workers worry about living comfortably throughout their retirement years. You provide a much-needed and appreciated benefit when you offer a retirement plan to employees. 

Are you concerned about cost?

There are a variety of plan types and features from which to choose – and they’re cost effective! I can work with you to find the right retirement plan features and services for your business based on your unique goals.

Established plan

What goals are set for your retirement plan?

Generally, the goal of a retirement plan is to help employees get retirement ready. Do you know if your plan is helping employees achieve that goal? I can help you assess your current retirement plan to determine:

  • If your plan is currently successful.
  • If your plan is aligned with your goals.
  • Changes that can help improve the success of the retirement plan.
  • A strategy to help minimize the amount of time you and your staff spend maintaining the plan.

Who helps with your fiduciary due diligence? Do you have a documented process in place?

Most plan sponsors are focused on running their business, they’re generally not experts on their fiduciary responsibilities. They may believe their service provider is handling it. I can help with formal, documented support through a fiduciary file, investment policy statement and more to help mitigate risk and satisfy due diligence requirements.

Do you have a fee policy statement and review process in place?

It’s important to document guidelines for managing and allocating fees and expenses and to consider whether the fees and expenses are reasonable. It can feel a bit daunting, but I can help. 

  • Outline the repeatable, documented process for evaluating plan fees and expenses.
  • Simplify and streamline the documentation process.
  • Show the plan fiduciary understands their responsibilities.

Do you have an investment policy statement and review process in place?

This is a fiduciary best practice, but many organizations don’t have an investment policy statement or a review process. I can help establish an investment policy statement that provides guidelines concerning your various types of investment management responsibilities.

Do you have an education policy in place? Do you review it often and measure its effectiveness?

An employee education policy statement can document goals and accountabilities related to an employee education program and provide a baseline for discussing employee education. Having a policy is important, but it’s also important to make sure it’s working the way it should be. I can help establish, review and monitor it. 

How much time are you spending on the plan?

Many plan sponsors would like to spend most of their time running their business – not on administrative duties related to the plan. I can help with your retirement plan needs, such as:

  • Investment lineup and management2
  • Plan design2
  • Risk management
  • Participant communication and education
  • Plan compliance testing and government reporting

What services are you and your employees getting, and what are you paying for them?

It’s important to evaluate the total amount paid to all service providers for an employer’s retirement program. And it’s important for plan sponsors to consider the level and quality of services of each provider as well as the impact on their own employee resources. I can walk you through that.

What types of investment options does your plan offer?

A plan could offer a mixture of:

  • Mutual funds
  • Separate accounts
  • Guaranteed investment contracts (GICs)
  • Stable value funds
  • Employer stock
  • Custom funds
  • Collective investment trusts (CITs)

It is a prudent fiduciary action to monitor the investment options the plan offers. The monitoring process should formalize a procedure to review and monitor performance of the investment options and align with the goals of the plan’s investment policy statement (IPS). I can help by performing an investment review periodically to help ensure plan objectives are being met.2

Small business plans

Start-up 401(k) plans

Simply Retirement
by Principal®

Pooled employer plans

Principal® EASE

Flexible retirement plans

Principal® Flex with TPA

Principal® Flex
with TPA


Principal® Flex without TPA

Principal® Flex
without TPA
Customized retirement plans

Principal® IMPACT

1EBRI Retirement Confidence Survey, April 2019.
2 Check with your firm to be sure you’re able to provide these fiduciary functions.

Principal makes available the investment options for customers to select through Simply Retirement by Principal®.  All other services are provided by service providers not affiliated with any company of the Principal Financial Group.  Refer to related documents and agreements for more details on plan services available.

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