Small Business 401(k) Administrators

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Ubiquity is a Top Choice Among Small Business 401(k) Administrators

When you first started your business, you probably handled human resources in-house. In other words: You, like most small business owners, probably served as your company’s entire HR department.

Handling tasks like payroll and hiring is manageable when you employ a handful of people. However, as your business grows beyond ten employees, the time inevitably comes to hire a third-party administrator who can oversee these essential functions and give you the time you need to focus on sales, technology, and development. Ubiquity 401(k) plans are designed specifically with the needs of small business 401(k) administrators in mind.

Should You Invest in Human Resources Administration?

Every penny counts when scaling up a small business, and no decision to expand comes lightly. Yet, working with a small business 401(k) administrator improves employee recruitment, management, retention, and workplace culture. If HR is doing its job, employee performance, commitment, and loyalty will increase, which in turn should help your business achieve its objectives and accomplish its goals. There are myriad statistics that support the importance of good HR for small businesses.

Here are just a few that support reasons why HR for small businesses is critical:

401(k) Plans Are A Top Recruiting Tool Benefitting Small Businesses

After healthcare, a 401(k) plan is considered the most valuable benefit to recruit and retain employees. Just 55% of American workers have access to a 401(k) retirement plan, which puts your business at an advantage over others if you offer this benefit to your hires. Studies reveal 80% of workers would rather receive benefits like a 401(k) than a pay raise. Employees young and old desire personalized education and financial planning assistance to reach their goals going into retirement.

A 401(k) plan can:

  • Attract and retain top talent: Retirement and financial wellness benefits are necessary to recruit the best workers. Fifty-one percent of employees joined their current employer largely because it offered a retirement plan, according to a survey by Willis Towers Watson
  • Improve morale: Long-term financial planning and retirement assistance keep your workforce happy and productive at work while reducing one of the most common stressors in life. Employer 401(k) matching can enhance employee morale and productivity even more.
  • Boost your ROI: One survey found a 36% reduction in payday advance requests, a 23% decrease in absenteeism, a 40% increase in productivity, and a 43% increase in employee morale among employees utilizing the company’s financial wellness tools and resources.

Many small business owners are hesitant to offer a retirement plan because they do not have the time, resources, or knowledge to manage the investment. By getting your retirement plan through Ubiquity, the work of the small business 401(k) administrator becomes minimal. Plan participants receive access to affordable investment options that are genuinely in their best interests.

What Do Business Administrators Need To Think About When It Comes To 401(k) Plans?

While there are many 401(k) plans geared toward small businesses these days, your administrator should examine how they differ in terms of:

Ease of Use: The best 401(k)s feature an easy-to-use digital interface, where you can log on to adjust your contribution and allocation as often as you’d like.

Compliance: A 401(k) compliance calendar can help you stay on top of the contribution deadlines necessary for 5500 and 1099-R forms, as well as safe harbor 401(k)s.

Integration: Payroll integration eliminates redundant data entry and reduces the risk of human error. Ubiquity has partnered with nearly 30 payroll providers to offer full 360-degree integration support. If you don’t see your provider listed, we can provide enhanced payroll services.

Onboarding: Widespread participation and effective implementation will be crucial to your plan’s success. Ubiquity’s Implementation Experts support you throughout the onboarding process, addressing the core needs of your operations and people.

Vesting: From an employee’s perspective, the best 401(k) plans allow contributions out of the first paycheck with 100% vesting. However, if turnover is a problem in your business, you may want to look for a 401(k) plan that allows vesting after a certain number of years.

Support: The best 401(k)s offer a combination of employer and employee-based support services. It includes direct lines of communication, as well as DIY forums and FAQs. At Ubiquity, all your support comes from US-based, in-house professionals.

What Are The Responsibilities of A 401(k) Small Business Administrator?

There are two official roles one can take as an administrator of a 401(k) plan:

401(k) Plan Trustee

The Plan’s Trustee has the fiduciary obligation of ensuring it is appropriately administered. One of those obligations is to make sure the annual tax Form 5500 is filed timely. A Trustee can add a Plan Sponsor, designate a Primary Plan Sponsor, or remove a Plan Sponsor.

At times, the Trustee may need to act as the Primary Plan Sponsor as well. Trustee authorization is always necessary to make any material modifications, including the addition or removal of Trustees.

401(k) Plan Sponsor

Plan Sponsors may update confidential employee information, view specific information regarding the retirement plan, and view participant account balances on Ubiquity’s platform.

Among their many duties, the Plan Sponsor:

  • Maintains an employee census
  • Processes payroll deductions (or ensures that your payroll provider is handling the task adequately)
  • Reviews rollovers from qualified plans or IRAs
  • Assists with annual compliance testing and required government filings
  • Reviews withdrawals
  • Sets up loan repayments in strict accordance with the amortization schedule (if your retirement plan allows)

The Primary Plan Sponsor is responsible for most of the day-to-day operations of the 401(k) plan and will receive email notifications when action is required.

Human Resources: Beyond Retirement Benefit Management

Human resources are vital to small business growth and success for reasons that extend beyond the 401(k). Small business administrators are qualified to handle responsibilities, including:

Employee paperwork – Confidential maintenance of files such as the I-9 required by the U.S. government, W-4s, payroll information, resume, etc.

Employee handbook – Communications, enforcement, and updates of company policy including standard operations, Non-disclosure and Do Not Compete agreements, compensation, benefits, termination protocol, etc.

Required posters – Compliance with requisite notices from the U.S. Department of Labor regarding job safety, wage requirements, and industry protocols.

Recruitment and hiring – Development of the hiring process, including drafting of job descriptions, determining where to recruit, and conducting background checks.

Employee payroll and benefits – Designing core benefits packages including include health insurance, vision and dental plans, life insurance, worker’s compensation, disability insurance, social security savings, and a retirement savings plan (401k). Offering a robust set of benefits that addresses the needs of your employees is just as important as good payroll management.

Ubiquity makes your 401(k) administration easy.

When you partner with Ubiquity to administer your employees’ 401(k), you are working with one of the country’s best. Since 1999, we have helped savers contribute over $2 billion toward their retirement. We look forward to growing your small business with this huge perk. Contact us for details about our 401(k) plan pricing and other HR benefits.

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© 2023 Ubiquity Retirement + Savings
Privacy Policy
44 Montgomery Street, Suite 300
San Francisco, CA 94104