Whether you’re an advisor or a plan sponsor, mid-year is the perfect time to assess what’s working and what could use a refresh.
Here are five common plan design gaps that could be limiting participation, tax benefits, or long-term outcomes:
Participation under 70% (and no auto-enroll!)
Low participation means employees are missing out and the plan could fail non-discrimination testing. Auto-enrollment is an easy win to boost participation and meet compliance goals.
No Roth feature
Without a Roth option, participants miss the opportunity to pay taxes now and enjoy tax-free growth and withdrawals in retirement. It's a key tool for younger savers and high earners alike.
No catch-up contributions enabled
Participants over 50 are missing a powerful way to save more. Catch-up contributions can be critical for those trying to close retirement gaps.
No profit-sharing, Safe Harbor, or meaningful employer contributions
These plan features can help attract and retain top talent plus, they can offer valuable tax advantages for owners. If your plan doesn’t include them, you may be leaving money (and motivation) on the table.
You haven’t talked to your TPA since last year
Plan design isn’t “set it and forget it.” A quick strategy session with your TPA can reveal opportunities you didn’t even know you were missing and July is a smart time to act before Q4 deadlines hit.
What to do:
Bring these issues to the table now, while there’s still time to make updates and improve outcomes for this year. A mid-year plan review might be the most valuable meeting you have this summer.
Why now?
You’ve still got time to make strategic updates before Q4 deadlines. These tweaks can have a big impact on plan success for participants and for the business.