Year-end planning can arrive quickly. For Plan Sponsors, the final months of the year may include compliance reviews, participant notices, plan design decisions, and preparation for the year ahead. Starting early can help clarify priorities, identify information gaps, and create time for thoughtful decisions.
The right steps depend on a plan’s provisions, effective dates, service providers, and individual circumstances. Still, a high-level review can help Plan Sponsors and Plan Advisors determine what deserves attention before December 31.
Begin by reviewing the plan document and confirming whether it reflects current provisions and applicable requirements. Outstanding amendments, unsigned documents, or a missed restatement may require additional coordination.
Plan Sponsors may also need to review required participant notices, including safe harbor, qualified default investment alternative (QDIA), and automatic enrollment notices, where applicable. Notice periods can vary, so confirm the requirements that apply to the plan and its upcoming plan year.
Contribution limits should also be reviewed to determine whether plan materials and systems reflect the applicable limits. If the plan doesn’t currently use automatic enrollment, year end may provide an opportunity to discuss whether that feature aligns with the Plan Sponsor’s goals.
Prior-year nondiscrimination testing results may reveal possible plan design change opportunities. Addressing those items before the next plan year may help identify and address potential administrative or plan-design issues. The appropriate response depends on the plan and testing results.
September, October, and early November can be useful planning points for decisions intended to take effect at year end or January 1. The timeline will vary based on the action under consideration and the number of stakeholders involved.
Projects that may require additional lead time include:
A January 1 effective date may be a preference, but it isn’t the only possible path. If a plan has a service concern or another priority, the Plan Sponsor and Plan Advisor can discuss whether a different effective date would support a more deliberate process.
An annual review can create space for broader conversations without committing the Plan Sponsor to a provider change. Open-ended questions may help reveal how the plan is serving both the organization and its people.
Consider asking:
These questions can connect plan administration with business objectives, workforce changes, participation, and retirement readiness. They can also help surface concerns before a service issue requires a reactionary response.
If a provider evaluation leads to a change, several stages may follow. The retirement planning committee may need to document its evaluation and decision-making process. The Plan Sponsor and Plan Advisor may then gather proposals, compare services and costs, and coordinate the decision.
Current providers may require advance notice, and participants may need communications about the change. If a blackout period applies – a restriction lasting more than three consecutive business days on directing investments, obtaining loans, or requesting distributions – notice is generally required at least 30 days but not more than 60 days before affected rights are restricted. Confirm the applicable timing and notice content with the appropriate professionals.
The transition itself can involve transferring and reconciling participant records, assets, vesting information, contribution sources, loan data, and hardship information. Payroll integration may add another dependency. Incomplete or outdated data, unavailable decision-makers, missing signatures, or delayed responses from a sending provider can affect the schedule.
Because each plan is different, transition estimates should be treated as planning guidelines rather than universal deadlines. A conservative timeline can help the Plan Sponsor account for dependencies outside its control.
Preparing for year end doesn’t require every decision to be finalized immediately. It can begin with a review of responsibilities, documents, data, committee availability, and participant needs.
For Plan Sponsors, an early conversation with a Plan Advisor can help organize the calendar and identify questions for service providers, administrators, or legal and tax professionals. With a practical, people-centered approach, year-end planning can become an opportunity to support the plan’s goals.
This article provides general educational information and isn’t intended to provide legal, tax, investment, or individualized financial advice. Plan Sponsors should consult their appropriate professionals regarding their specific plan and circumstances. Regulatory requirements and deadlines may change. Please verify applicable requirements before taking action.
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