Any business that wants to sponsor a retirement plan for their employees should be applauded. In today’s economy, it is a struggle just to maintain a business, let alone worry about your employees future financial security. Employers who make generous contributions to their employees retirement fund have an excellent selling point when trying to retain their key employees or attract new employees.
Many businesses have been shying away from sponsoring retirement benefits such as a 401K retirement plan for their employees because of the liabilities and recent news reports of businesses that did not act in their employees best interests when they acted as the fiduciary, and assumed responsibility for the plan. This unfortunately, made headlines and left many small businesses wary of offering their employees a very useful tool to insure a financially secure retirement.
Now, many small businesses are turning to independent fiduciaries to assume the day-to-day responsibilities of managing their employees retirement benefits instead of being dissuaded from offering retirement benefits. Independent fiduciaries have an obligation to offer a businesses employees sound invest options designed to maximize retirement savings. Workers should have all the knowledge they need to make these decisions and the employer basically stays out of the decision making process altogether, removing them from the liability of making poor investment suggestions. Independent fiduciaries know their responsibilities and act accordingly.