404a-5 Means Opportunities for Advisors

At a NAPA-hosted webcast on Oct, 16th, presenters focused on the challenges and action items surrounding 404a-5 disclosures and offered ways for advisors to add value for their clients. Key take-aways for plan advisors included:
• Create a simple and repeatable process.
• Be the quarterback — make sure everything is being handled properly and on time.
• Compose a personal cover e-mail.
• Make sure everyone who needs to be informed actually is including missing participants.
• 404a-5 may be an opportunity for advisors to:
— Educate participants on other benefits and consequences of cashing out.
— Limit DIAs.
— Illuminate clients about the value of communicating electronically.
• Prospecting opportunities include:
— Consequences of non-compliance, such as loss of 404(c) safe harbor status.
— Interpretation of fees and whether they are reasonable.
— Review of advisory fees.
The webcast was presented by Joan Neri of Drinker Biddle, Chad Gutner of Samuel Financial and Sadie Hooker of Nova 401(k) Services. To download a pdf of the slides that accompanied the presentation, click here.