401(k) Plans
Most business owners' 401(k) plans repeat four common mistakes: paying too much in fees, a poor investment lineup, powerful plan features left unused, and an outdated design that blocks what the law now allows. Each is a choice baked into how the plan was built, and each is fixable.
Four Common 401(k) Mistakes
Almost every plan we review repeats the same four mistakes. The encouraging part: all four are fixable, because all four are choices baked into how the plan was designed.
Paying too much in fees
Excessive recordkeeping, advisory, and fund fees quietly erode every balance in the plan, year after year. It is a design choice, and a fixable one.
A poor investment lineup
Limited, expensive, or carelessly chosen funds leave participants with no good options. Also a design choice: a better menu is available to any plan willing to build it.
Powerful features left unused
After-tax contributions, in-plan Roth conversions, a self-directed window: real benefits sit inside many plans that participants never touch, buried in jargon that goes in one ear and out the other. We translate them and put them to work.
An outdated plan design
The law keeps expanding what plans can offer, but a plan only allows what the company built into it. We repeatedly see designs that block strategies the law plainly permits. A thoughtful redesign unlocks them.
Plan Features Most Participants Never Notice
Most 401(k) plans contain features participants never use. Sometimes the plan documents are dense. Sometimes no one has taken the time to walk through them. We read each client's plan, surface the choices and benefits that matter, and explain how to deploy them. Common examples include Roth contributions, mega-backdoor capacity, true-up matching, after-tax contributions, in-service distributions, and profit-sharing tiers. Whether any of these are available depends on the specific plan, and whether they are useful depends on your situation. That is the conversation we have with every client who brings us a 401(k).
Direct Management Inside the 401(k), Where the Plan Allows It
In many plans we can also manage the money inside the 401(k) directly, alongside the rest of your portfolio. This is not possible in every plan and depends on what the plan sponsor and recordkeeper permit. Where it is permitted, having a fiduciary advisor pay attention to the account on an ongoing basis is often a meaningfully different experience than leaving it on autopilot. We assess each plan individually to determine what is available and how to put it to work.
This is a separate, real benefit from the plan-design work we do for business owners. When a business owner brings their company's 401(k) under our care, participants get access to this same level of attention, an intangible benefit many companies overlook when they evaluate a 401(k) provider on cost alone.
How We Help Business Owners
We conduct a comprehensive 401(k) plan review that examines fees, investment options, plan design, and compliance. For business owners, we also evaluate whether a 401(k) is still the best structure, or whether a cash balance plan, defined benefit plan, or other approach would deliver better results.
Ready to Optimize Your 401(k)?
A better 401(k) plan benefits you and your employees. Schedule a plan review with Stefan and find out how much you could save.
A Quiet Invitation
The right plan design can move far more to you and your key people than most owners realize. Let us review your current plan and the strategies, from profit sharing to cash balance, that could be working harder for you. We do not believe in pressure or hard pitches. We believe in the right relationship with the right people at the right time.
Schedule a Conversation