Safe Harbor Mid-Year AmendmentsApril 15, 2016
401(k) Plans Made EasyJune 6, 2016
Changing a Fearful Situation into Peace of Mind
By: Kim Littrell
When the phone rings at Benefits Administrators, we never know what to expect. It may be an employer setting up a new benefits plan who needs help making sure it’s in compliance with state and federal laws. Or, it could be a client seeking advice or support for a routine matter with an existing plan. Those are typical because we’re always working behind the scenes to make things run smoothly for our clients.
Not long ago, though, we received a call of a different nature. A client was very concerned because one of his employees was in a financial bind due to some unforeseen expenses. It was such a dire situation that this employee was hoping to cash out his retirement plan, which he saw as his last resort.
They contacted us to find out if he could do this, how it would affect his future, and, ultimately, what penalties he would face if he did. The short answer was that yes, he could do that. But it would have put him in an even deeper hole financially.
Fortunately, we were able offer him several options that were much more in his favor. After a discussion with the employee, we added a loan provision to his plan that enabled him to borrow the money against his own assets and pay it back with his paycheck over a period of time, just like he would his regular contributions.
What a relief it was to the employer and the employee to have such a positive outcome. Neither had any idea we could set this up. But our team of experts have dealt with almost every situation, so we knew there were good alternatives in this case.
A retirement plan coordinator is probably not a job most people hear about every day. But as this example demonstrates, the best way to describe what we do at Benefits Administrators is that we help people by alleviating their stress.
The IRS and Department of Labor have strict guidelines that employers must follow throughout the year in regards to reporting, employee notifications, discrimination testing, and contribution calculations. We ensure these are done correctly and by the enforced deadlines.
This is just one example of who we are and what we do. But it’s a good case because it shows how we make our clients’ lives easier and ensure that their plan is beneficial to the employees and to the company itself.
We love happy endings.