For small businesses, there's no wrong time to take a fresh look at the company retirement plan. Between business growth, evolving rules and regulations, and growing employee expectations, a 401(k) that worked in the past may no longer support today’s workforce. So, the smart move for owners is to be proactive and ensure their 401(k) keeps pace for the future.
Use this checklist to understand what to review and refresh, and keep your 401(k) ready for whatever's ahead.
1. Confirm You’re Meeting All Compliance and Mandate Requirements
A compliant plan is your foundation, and your first step should always be making sure your plan still meets current rules (and upcoming ones). Be sure to check that you’ve:
- Reviewed different IRS rules around things like vesting schedules, catch-up contributions, and nondiscrimination tests
- Updated with plan documents for SECURE 2.0 changes
- Completed any required filings (Form 5500, notices, etc.)
If you spot gaps or aren’t sure you’re fully compliant, the good news is that many issues can be addressed now, and your plan provider should be able to help you get back on track.
2. Review Catch-Up Rules and Contribution Limits
Contribution limits and rules are expected to continue to evolve, especially as SECURE 2.0 changes come into effect in the new year. To stay on top of these, employers should:
- Confirm the current employer and employee contribution limits
- Review new catch-up contribution rules, including the Roth catch-up requirement for high earners ($150,000+ in prior-year wages)
- Ensure your payroll systems are streamlined and can support new contribution types like Roth catch-up
- Communicate changes early and clearly with your employees
The clear communication part is especially important here as it will reduce confusion later and help your workforce maximize their savings now and stay engaged with your 401(k).
3. See Whether Your Plan Still Works for Your Business
Your business may look very different now than when you originally set up your 401(k). Take this chance to review:
- If your plan design still aligns with your goals
- Whether participation rates are where you want them to be
- Whether your employer match and vesting schedules still work for your growing team
- Whether your team will be changing even more in the coming year
4. Take a Closer Look at Your Plan Costs
Most employers don’t realize how much their plan costs can grow over time, especially if they have a percentage-based cost model. To control costs as you scale, you need to review:
- How your fees are being calculated
- How costs have grown since you started your plan
- How fees are explained to participants
Flat-fee 401(k)s are becoming increasingly popular because they’re transparent, predictable, and offer easier budgeting in the long term. Along with flat-fee models, more employers are utilizing tax advantages like SECURE 2.0 startup tax credits and other deductions, so you can do this too if your business is eligible.
5. Keep Payroll and Plan Administration Aligned
One of the most common challenges with maintaining a plan is a complicated payroll system. Not only do payroll issues complicate administration but they can put you at risk of noncompliance quickly. You’ll need to double-check that:
- Contributions are being processed on time and accurately
- Your payroll provider integrates easily with your existing systems and plan
- Your employees know who to contact if a problem arises
If payroll continues to cause friction, it may be worth working with a retirement provider that offers a payroll-agnostic model. This flexibility ensures your payroll changes with your business as it evolves and reduces bottlenecks overall.
6. Reevaluate How You Communicate 401(k) Changes to Employees
Keeping your plan simple to understand is crucial for employee engagement and motivation. So, it’s important to consider:
- Reframing your plan as a long-term benefit to stay involved with, not paperwork to forget about
- Providing education to ensure employees know how to change contributions and investments
- Finding ways to streamline enrollment materials, and utilizing educational resources your plan provider may offer
7. Ensure Your Plan Keeps You Competitive for Talent
Robust retirement benefits are one of the major signals of stability, trust, and long-term investment for employees. So, when evaluating your plan strategy, be sure to ask yourself:
- Do I feel confident enough mentioning this plan during the hiring process?
- Do my plan offerings (flexible contributions, hardship loan options, etc.) feel comparable to what larger businesses provide?
- Would a candidate see my plan as simple to manage and easy to understand?
When a 401(k) is well-designed, it not only becomes an invaluable recruiting tool but also reinforces your company’s commitment to its people.
Make Retirement Readiness an Ongoing Priority
It’s important to remember that retirement plans aren’t about setting it and forgetting it. You’ll have to review, refine, and support it over time to get the most out of it and have a future-ready plan that is actually ready to scale with your business.
At Ubiquity, we help businesses make retirement readiness possible with transparent, flat pricing, flexible plan design, and world-class support. By keeping plan maintenance manageable, employers can feel confident and ready for long-term financial security.
