Auto-enrollment and auto-escalation 401(k) features have gained wide acceptance as a means of boosting employee participation and deferral levels. But an inadvertent clerical error in the operation of those systems can prove costly to plan sponsors. Advisers can add value to their service to business clients by alerting them to these pitfalls — pointing them to possible payroll systems slip-ups, or perhaps even doing a spot check themselves every now and then.

One of the most common problem areas is failing to start the prescribed auto-deferrals or auto-step-up in deferrals when they are supposed to kick in, according to Kari Jakobe, a Minneapolis-based principal and operations manager for Milliman’s employee benefits consulting practice

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