The why will be as individual as you are! Here are some of the common answers why a client might choose MMG:
With my current provider, I can’t get anyone on the phone who knows my plan and can answer my questions.
I need to stay competitive in my industry, so I need to provide a competitive plan.
My accountant or financial advisor said I could save money on my taxes by starting a retirement plan.
I just want to provide a no-hassle retirement plan for my employees to contribute.
I want to put as much money away as possible.
I want to provide a tax-deductible incentive for myself and my employees.
The majority of bundled providers will provide between 5 and 7 contacts for a plan: a day-to-day contact, a relationship manager, a testing and/or ERISA consultant, a distribution contact and a participant contact. Some of these points of contact may even be a new person each time the sponsor or participant seeks support. With MMG, you will have a dedicated primary contact responsible for your day-to-day communication. While that contact is supported by a team, and internal specialists are available on an as-needed basis, that single point of contact will always remain engaged throughout the process. Further, when MMG works with a partner recordkeeping platform, the platform provides the plan one primary contact.
The answer depends on how you look at price vs. cost. Price is often what people refer to when they compare whether something is “expensive”. Cost takes into account the value that is being provided, as well as other factors such as contribution refunds, a la carte add-ons, and risk exposure. In the end, if the cost of MMG is not in line with other options, clients will not engage us. Most often, plan sponsors find we are more cost-efficient than competitors, bundled or unbundled.
All three, financial advisors, recordkeepers and TPAs, are critical components of successful retirement plans. Each component must possess the requisite expertise in their specialties. The recordkeeper is the primary interface for plan participants, providing participant records, web and phone interface and day-to-day participant experience. The financial advisor is responsible for monitoring the funds offered to the plan, the overall investment program, and oversight of the participant education and success. The TPA is responsible for oversight and guidance related to the plan document, compliance testing, contribution requirements, and necessary government filings. All three must work together to make the plan successful.
Much like any professional service provider, the expertise level of a TPA can vary greatly. Many TPAs focus only on the small plan market, and do not have the staffing or experience available to handle the myriad legal, actuarial and compliance challenges many plans continue to face. MMG is staffed with attorneys, actuaries and experienced service teams that can support the broad spectrum of plans available, from one-person plans to publicly traded companies. The MMG full service model enables us to service plans as simple as 401(k) deferral and match plans to as complicated as a combination cash balance pension plan and 401(k) profit sharing plan. Further, that full-service approach has made us the go-to provider of litigation support for all types of retirement plans.
Much like bundled recordkeeping services, producing TPAs bundle their investment advisory services with their administration and consulting services. While this may be accomplished skillfully, it is very difficult to receive and maintain sufficient expertise in both areas. For MMG, financial advisors are one of our top referral sources and service partners. As a non-producing TPA, MMG concentrates our energy on delivering valuable plan design, actuarial, consulting, and compliance services. We do not compete with our financial advisor referral partners.
It depends on the quality of your TPA firm. Given the potential financial and legal consequences of an adversarial audit or investigation, it is critical to have the best representation possible. If your TPA does not have ERISA attorneys on staff to oversee the process, you should further investigate how they handle IRS and Department of Labor inquiries, audits and investigations, and whether they can provide the necessary legal expertise.