Summit advisors take a hands-on approach to managing your plan cost, performance, and compliance so you can avoid surprises down the road.
THE CHALLENGE:
Before Summit, this aviation company with over $40 million in assets and 500+ employees had a recordkeeper with steep fees and a commission-based advisor. This advisor did not act as a fiduciary or provide the strategic insight the client needed to optimize plan performance.
“The previous advisor had left their plan on “auto pilot,” failing to properly monitor plan costs, fund performance, and compliance requirements.”
The client’s 401k plan document was out of compliance, and the plan’s proprietary funds were underperforming. On top of this, they had an antiquated, non-transparent fee structure in which exact payments to the advisor, recordkeeper and mutual fund managers were difficult to determine. Overall, the client’s trust in advisors and record keepers had plummeted.
WHAT WE DID:
Summit’s active, hands-on approach and ability to act as a discretionary 3(38) fiduciary was a welcomed change. After an ERISA attorney-led RFP, our team got to work analyzing and proposing improvements for the client’s plan. Throughout this 5-month RFP process, Summit modeled our client commitment and ability to strengthen their plan.
“Upon being hired, Summit uncovered multiple challenges left behind by the previous advisor and built a definite, actionable path forward for the organization.”
Summit conducted a full analysis of investment options to prepare a new investment lineup, removing proprietary funds to the current recordkeeper. Our team also brought the plan back into compliance, keeping in line with the most up-to-date legislative requirements. Then, Summit negotiated fair compensation for the recordkeeper and mutual fund managers on the client’s behalf.
THE RESULT:
“Summit created a remarkable 80,000 in total cost savings by negotiating on behalf of the client and acting as a discretionary 3(38) fiduciary.”
Summit’s strategic revisions of the client’s investment lineup controlled client plan costs as well as recordkeeping expenses for plan participants. Summit advisors also assisted the client in bringing the 401k plan document back into compliance with outside council, avoiding potential future legal fees and obstacles.
