As you read this article, the various notices for the 2014 plan year are freshly mailed. It is now time for plan sponsors and their advisers to sit down and review what worked in 2013 and what improvements can be made for 2014. This is also the time for human resources to review plan design optimization strategies to take advantage of ways to improve plan and participant outcomes.

Participants appear to recognize they are behind on saving for retirement. Only 30% of participants in the J.P. Morgan Asset Management survey said they expected their savings to last through their retirement years. Yet, the results show many participants are not confident in their ability to manage their retirement accounts. More than half (52%) said they don't have sufficient talent to plan for retirement and almost half (44%) reported that they are receiving more 401(k) plan information than they can absorb. Is all the information helping or hurting plan participation? Will employees read the notices they are given, or is it a waste? Here are a few items to kick 2014 off:



  • Send payroll and employee census data to the plan's record keeper for year-end compliance testing (calendar year plans).
  • Audit fourth quarter payroll and plan deposit dates to ensure compliance with the U.S. Department of Labor on participant contributions and loan repayments.
  • Verify that employees who became eligible for the plan between Oct. 1 and Dec. 31 received an enrollment form. Follow up on forms that were not returned.
  • Make sure enrollment material is up to date.
  • Contact your plan provider to see what communications are planned for the year and the timetable for roll-out.
  • Review year-end plan level reports covering deposits and withdrawals for 2013.


  • Update the plan's ERISA fidelity bond coverage to reflect the plan's assets as of Dec. 31 (calendar-year plans). Remember that if the plan holds employer stock, bond coverage is higher than for non-stock plans.
  • Issue a reminder memo or email to all employees to encourage them to review and update, if necessary, their beneficiary designations.
  • Review and revise the roster of all plan fiduciaries and confirm each individual's responsibilities and duties to the plan in writing. Ensure each fiduciary understands.


  • 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 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.
  • Review testing info provided by the record keeper.

Securities and advisory services offered through LPL Financial, a Registered Investment Advisor, Member FINRA/SIPC.

Ludwig, ChFC, AIF, CRPS, is a financial adviser with LHDretirement. Reach him at

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