It is probably of no surprise to anyone reading this that these past few months has created a little bit of a brain fog for many of us. Managing clients is, for the most part, a linear process. Phone calls, emails, allocation analysis and any appropriate adjustments based on a client’s unique needs or evolving life circumstances. On the other side of my brain, the creative side, it has developed a little bit of a writer’s block, and as I sat down to try and write a relevant think-piece, I decided that I needed to start at the beginning- the foundation and driving force of my values as a financial advisor and my passion for working with business owners. Why do I do what I do? What do I get excited about when a business owner chooses Moneywise as their trusted 401k advisor aka partner? “Ah ha! Look at your notes!”

These notes are the record of every conversation that I have had with business owner clients, friends, and prospects over the last few years. What are the consistent and important themes that never go away when it comes to business owners and their company’s retirement plan? How can and how do I help? These notes are the window into the mind and spirit of business owners. They are a record of business owners’ concerns, reliefs, triumphs, and failures. They are a record of trying to find a better way to incentivize employees, retain key talent, and a more efficient way to reduce administrative roadblocks. They want to be their absolute best. The times and the regulatory rules may have changed a bit since these initial notes were taken, but the heart of these discussion themes is the same. The following are what I have found and get great pleasure from helping business owners with:

1. Companies that offer a robust retirement plan, i.e. 401k, a SEP IRA, a SIMPLE IRA etc., want to know that it is going to be easy to administer. The business exists to provide a product or service, to assist and maintain a happy customer base, and to make a good living when all is said and done. A business owner does not start a business to become or practice being a retirement plan expert nor do they have the time for this! It is a full-time gig.
2. Business owners want and seek to minimize their fiduciary liability when starting up and maintaining a retirement plan for employees. But what about fiduciary support, experienced advice, and management to help mitigate the automatically built in, very real and profoundly serious legal obligations of providing such a plan? In other words, business owners do not want to financially or energy wise take any unnecessary risks when administering a retirement plan. That is where a 401k specialized financial advisor like me makes a HUGE difference.
3. Most business owners do not know how to accurately identify whether their plan is actively and ongoingly compliant or not. Sadly, a lot of “financial advisors” fall in the same bucket or they are happy enough to collect their fees and never think twice about the health of the company’s plan. This drives me crazy; bonkers really. ERISA, DOL, IRS, and a number of other state regulators determine the rules of the road for governing retirement plans, and many plan sponsors simply don’t know or understand all of the rules governing their plan. This lack of specific and actionable knowledge can be a massive liability for the business owner and can costthe company not only substantial fines and fees, but also, in some cases, cause the plan to lose its tax-qualified status. This neglect is disturbingly common and widespread.
4. Business owners rarely know if their retirement plan’s financial advisory team is acutely knowledgeable, keeping up to speed with new plan options and working with reliable plan providers. I have run into a great amount of baffling, inappropriate and questionable plan selections. I know that no business owner wants to do work with any vendor that they have never heard of or has zero track record of success, so how is a company’s retirement plan any different? It is important to seek experienced, trusted, and transparent financial advisors that can provide sound recommendations so a business owner can trust that their company’s plan is compliant, efficient, and effective.
5. Lastly, who is monitoring the plan’s ongoing cost analysis in a market that is constantly changing? If the plan seems rather good but is twice the cost of a comparable plan elsewhere, how would a business owner know? Again! A full-time expert is needed, because a) one size does not fit all, and b) a retirement plan and the high-level company’s goals are not stagnant. The new and major fiduciary duty of the business owner is to make sure that their plan’s cost structure is kept under control and makes sense. Recent lawsuits in the retirement space mostly concern excessive fees being charged within a plan. Business owners do not want to be the target of fiduciary breach lawsuits, and excessive fees are the #1 avenue for these types of lawsuits.

So, there you have it. The five major pillars that business owners deal with whether they are aware of it or not. For years we at Moneywise Wealth Management, have been partnering with business owners to help them to manage + administer their retirement plans with passion, experience, and trust. These relationships form the basis for our Business Services Division and push me to continually improve not only the plans that we offer but the ongoing advice that we provide.

As always, the Moneywise team is here and accessible to help guide you through the tangled web of retirement plans, changes to retirement laws, and assisting with participant outcomes. We can assist and help determine what type of plan makes the most sense for your organization and help implement these strategies, so you do not have to. We know what we are doing, we care, and we have got your back.

If you have any questions or would like more information, please reach out to our Moneywise 401k specialist + Director of Business Services, Justin Leland. Call: 661.847.1000 or email: justin@moneywiseguys.com.

PLEASE REMEMBER! One size does not fit all. This topic is an educational talking point. If you have any questions about how this subject might impact your personal financial + retirement planning, or if you are interested in learning more about how our Moneywise financial advisors can help you, your family, or business, please reach out to us!

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We’re here to help in any way that we can.

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