The Complete Guide To Choosing, Setting Up & Maintaining A Company Retirement Plan

Every single thing you need to know to get your company retirement plan up and running

Start by thinking about your intentions, rather than different types of retirement plans.

Finding the best retirement plan for your business has everything to do with your goals. The very first step you should take is to identify what you are trying to accomplish with the plan. If you’re unsure of your goals, but just know you need a plan, ask yourself the following questions:

  • Is the priority to maximize the funding of your own retirement account?
  • Are you focused on attracting and retaining top talent by offering a competitive retirement plan?
  • Are you looking to reward certain employees more than others?
  • Are you looking to offer a vehicle for your employees to save for their retirement, even if you are unable to provide any funding at this time?

Business Owners Need Trusted Retirement Plan Support

Find a third party retirement plan administrator (TPA) you can trust.

Whether you’re developing a new plan or switching administrators, your TPA should make sure everything is taken care of and the plan is designed to fit your needs. This allows you to focus on running your business.

Your retirement plan TPA should stand shoulder-to-shoulder with you throughout the life of your plan to ensure you properly attend to your fiduciary duties and that you, your business, and your employees continue to receive maximum benefit from your business retirement plan. As part of your qualified retirement plan design, your plan administrator will help you:

  • Choose the plan that is right for you
  • Draft the plan documents and set up the plan
  • Prepare notices for your employees letting them know how to participate
  • Perform annual testing to make sure the plan is compliant
  • Process plan distributions and loans
  • Amend the plan when legislation requires it or when the needs of the company change
  • Make sure you are getting the most out of the plan

At the end of the year, your dedicated administrator needs to take the time necessary to perform a thorough evaluation of your plan’s overall health so you have a clear understanding of your plan’s status. You have enough to worry about—let your TPA help get your retirement plan in shape.

You Have Options Beyond 401(k) or Safe Harbor 401(k) Plans

Understand that you have options.

Some 401(k) TPAs may suggest cookie-cutter plans that are easy to establish and administer. Look for an administrator that will provide a comprehensive analysis of available options and are able to identify enhancements and additional benefits over and above these plans in many cases.

The reasons why you’ve decided to set up a retirement plan for your company will determine which plan is best for you and which features you'll want to include. It doesn’t matter if your main goal is to put away money for yourself, reward top-performing employees, or be more competitive in recruiting employees, your retirement plan TPA will help design a plan in line with your intentions.

Many business owners enter the conversation having done some research and have an idea what their plan should look like, but that research is unlikely to include detailed information customized to you and your business. That’s why a good TPA will work with you to create a custom plan designed to meet your goals and build successful outcomes for everyone at your company. You can explore options customized for you and your business needs, with considerations like:

  • Waiting periods for employee and employer contributions, entry dates, and employee classifications
  • Excluding bonuses, overtime, commissions, or fringe benefits in the formula for computing contributions
  • Provide contributions only to full-time employees who don't quit during the year
  • Tiered allocation and age-weighted formulas instead of basic pro-rata contributions

Having flexibility with respect to your plan design is the difference between a retirement plan that works and one that works for you. While your company may already offer a plan to your employees, could it be better or offer more flexibility for what you want the plan to provide?

Compare Plan Types

Wondering what the difference is between a 401(k) and a 403(b)? Confused about Safe Harbor 401(k)? And what is prevailing wage? Comparing retirement plans can be complicated, so we’ve rounded up the need-to-know information to get you started.

we’re here to help when you are ready


Who will be involved with the plan set up and maintenance?

Learn more below about the different service providers and the role each plays in keeping the plan a success.

Key Players in a Retirement Plan

Overview of Retirement Plan Set Up

CHOOSE PLAN DESIGN AND DOCUMENTS - design options are listed below, but if you'd rather just have someone walk you through each of these one the phone with you, request contact here for personalized help deciding on these options.

Once you have outlined your goals for what the plan will look like, you can figure out how to have your retirement plan set up to fit your needs.  Even prototype plans offer options for employers to draft a semi-custom document:

  • Waiting period – How long does an employee need to wait before he or she becomes eligible for the plan?  You can offer immediate entry or require up to a one-year wait for 401(k) plans. 
  • Age – You can require that an employee be 21 years old before they are eligible for the plan.  Any age below that is allowed as well; it’s up to you!
  • Open enrollment periods – When will an employee be allowed to enroll once they have satisfied the waiting and age requirements?  Options include immediate, monthly, quarterly, semi-annually, or annually.
  • Contributions – 
    • Will the plan include the option for employee contributions?  Will you include a Roth (after-tax) option in addition to the pre-tax option?
    • Will you fund a matching contribution?  If so, will you have a fixed formula or leave the decision about the amount until the end of the year?
    • What about profit sharing?  There are a variety of allocation formulas available.  Given your goals, which one is right for you?
    • You may wish to include a pension plan to maximize the amount of employer contributions that can be deposited to retirement accounts each year.
  • Vesting – Will employer contributions be subject to a vesting schedule?  Vesting options range from 100% immediate vesting to three-year cliff vesting (0%, 0%, 100%) to six-year graded vesting (0%, 20%, 40%, 60%, 80%, 100%). 
  • Forfeitures – Employer contributions are forfeited by employees who are not fully vested. Forfeitures can be used to pay fees, offset employer contributions, or allocated in addition to employer contributions.
  • Retirement age – At the plan’s defined Normal Retirement Age (NRA), a participant becomes 100% vested in all accounts.  NRA can be a specific age such as 59 ½, 62, or 65 or have a qualifier; for example, age 65 plus five years of participation.
  • Distribution options – Will the plan only offer lump-sum distribution?  Would you like the plan to offer installment payments and/or annuity benefits as an option?  What about loans or withdrawals due to financial hardship?
  • Compliance testing options – All plans are subject to compliance testing, but many tests have alternatives available:
    • 401(k) non-discrimination can use either prior-year or current-year testing methods
    • 401(k) testing can be avoided if Safe Harbor contributions are offered
    • Definition of Highly Compensated Employee can be limited to the top 20% of employees
    • Top-heavy contributions can include or exclude Key Employees

Get your Free Consultation to see which type of plan would be best for you! Not only will you learn how to set up a 401k, we will walk you through each step.

How to Maintain the Retirement Plan Through the Year

You will be processing distributions and loan requests for participants in the plan.  Our role as TPA is to review the vesting and eligibility for distributions to avoid problems, or money being paid inappropriately.

At the end of the year, we’ll ask you for information about your employees and the deposits made to your plan.

As your TPA, we will perform the compliance tests, prepare financial statements, and draft the Form 5500 filing that must be submitted to the Department of Labor each year.  Keep reading for the critical due dates for retirement plans.

COMMUNICATIONS – There are a variety of notices to provide to the employees eligible for the plan.  In addition to information about the Plan and Enrollment, certain plan features such as Safe Harbor, Automatic Enrollment, and default investments must be provided annually.  At Benefit Resources, we provide assistance in preparing and reminding you about notices that are required.

Our industry is full of deadlines.


Some due dates are fixed, meaning that they always happen on a particular date every year.  Examples of fixed dates are:

 Form 1099R

 January 31

 report distributions from retirement plans in the  prior year

 Form 1096

 February 28

 cover page for submitting Forms 1099R



Most dates relating to due dates for retirement plans are dependent on the Plan Year.  The majority of plans are administered on a calendar year, but a good portion is administered on a fiscal year.  Very often if the company that sponsors a plan has a fiscal year, then the plan may be run on that same fiscal year.  A list of the rolling due dates for a retirement plan is shown below.  All dates relate to the end of the plan year.

 Compliance corrections (if necessary)

 2 ½ months after end of plan year

 Contributions for deduction purposes

 2 ½ months for corporations, 3 ½ months for others

 Contributions may be extended for

 6-months after initial deadline

 Mandatory contributions

 8 ½ months after end of plan year

 Form 5500 due date

 7 months after end of plan year

 Form 5500 may be extended for

 2 ½ months after initial deadline

 Participant notices

 30-90 days prior to the effective date (Safe Harbor status, Automatic Enrollment materials  and/or Qualified Default Investment Arrangement)

 Plan Amendments

 In general amendments must be signed before they are effective


We encourage all of our clients to have these due dates on their calendar, with a reminder at least 30-days in advance.

Not sure you are getting what you need from your TPA? (An indication is that you are here rather than on the phone with them.) We can look at your latest 5500 and give you insight.



There is a way to fix the problem of failing to meet a deadline as outlined here. 

 Compliance corrections (if necessary)

 Can be corrected up through the end of the following plan year


 May be made up through the end of the following plan year, but changes to the timing of the contribution will change the timing of the tax deduction

 Form 5500 due date

 You can file under the Delinquent Filer Voluntary Compliance program for a fee of $750 for a small plan, or $1,500 for a plan with over 100 participants. 

 Participant notices

 Failure to provide notices timely can be very expensive; up to $100 per day per participant!

 Plan Amendments

 The Employee Plans Compliance Resolution System includes ways to retroactively amend plans and make other corrections that may be needed.  These submittals typically require the expertise of an attorney who specializes in ERISA law.


As your Third Party Administrator, we will work with you to make sure you get us your work on time.  Given the way that our industry is wired with due date after due date, we want to make sure that you are in compliance at all times. 

Here's what we do throughout the year to keep our clients in compliance:

We will:

  • Calculate contributions for each eligible Employee
  • Calculate maximum deductible employer contributions
  • Perform all mandatory compliance testing
  • Compare transactions processed by the retirement plan provider with client records
  • Reconcile Trust accounts and prepare financial statements
  • Prepare annual administrative reports
  • Prepare government filings: Form 5500 and related schedules
  • Prepare statements and Summary Annual Reports for Participants
  • Prepare Employee communications
  • Determine eligibility for participation
  • Determine Highly Compensated and Key Employee status
  • Prepare participant notices

Ready to get your retirement plan in place?

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