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VESTED INTEREST® ARTICLE SETTING GOALS FOR YOUR RETIREMENT PLAN Whether you are establishing a new retirement plan or looking to improve an existing one, setting goals is a critical first step in achieving a plan that is highly effective for the company as well as for its employees. Real success springs from a shared mission to help employees achieve financial security in retirement. The goals set by each employer may be specific to their situation and circumstances, but they share a common framework. Here are five best practices to help guide plan sponsors. ESTABLISH A SOUND MANAGEMENT AND OVERSIGHT STRUCTURE CREATE A PARTNERSHIP WITH YOUR EMPLOYEES A retirement plan needs to be viewed as something greater than just another employee benefit that the marketplace requires an employer to offer. Real success springs from a belief that the employer is in a partnership with its employees in a shared mission to help them achieve financial security in retirement. This partnership may take many forms, including matching contributions, auto-enrollment, continuing education and planning assistance. When employees experience this sense of partnership, it generally enhances participation and deferral rates, as well as talent retention. To Do: Consider an employee survey to ascertain your employees’ view of your 401(k) and their needs in maximizing its value. Qualified plans create substantial responsibilities for plan sponsors and the plan’s fiduciaries. To manage a plan prudently and to help fulfill these responsibilities, it is critical to create a management framework and oversight structure with clear roles and responsibilities. Close coordination between the plan governing committees and plan providers is essential. EMPHASIZE CONTINUOUS IMPROVEMENT Retirement plans, especially 401(k) plans, are constantly evolving. Thought leadership and product development over the last five years have led to significant changes in what constitutes a modern, competitive offering. Success is never static; it is a dynamic process that requires plan sponsors to be responsive to this evolving landscape. To Do: Establish an annual communication plan between the retirement plan committee and your plan provider(s). Then, document discussions from these meetings and any action steps to be taken. To Do: Benchmark your current plan features against what’s available in the marketplace today. Determine if gaps in features may suggest relevant enhancements for your participants. pnc.com/vestedinterest 2 SETTING GOALS FOR YOUR RETIREMENT PLAN MAINTAIN AND MONITOR YOUR PLAN Periodic benchmarking of your plan to your industry and to the marketplace generally is an important discipline that will help a plan sponsor to gauge its continuing relative competitiveness, compare plan costs and assess the efficacy of its education, communications and investment offering. As a consequence, responsible internal parties should not hesitate to engage outside professionals to help them through the regulatory, investment and enrollment challenges qualified plans present. Plan providers not only have a deep knowledge of these myriad issues, but can draw upon the realworld experiences of similar plan sponsors to help guide your decision-making. To Do: Send a Request for Proposal to a select list of providers. Evaluate the responses relative to your current offering — cost, investment offering, features, support, tools, etc. To Do: Contact your 401(k) provider account manager today to set up a meeting to discuss how he or she may be of help in addressing your top plan sponsor concerns in 2014. LEVERAGE KNOWLEDGE In smaller companies, the retirement plan responsibility may fall to an internal employee with other, full-time responsibilities. Very often he or she may lack a comprehensive experience with the varied elements of plan sponsorship, such as investment selection, regulatory requirements and effective communications. FOR MORE INFORMATION Please visit pnc.com/vestedinterest or call 1-855-303-0890. The PNC Financial Services Group, Inc. (“PNC”) uses the name PNC Institutional Investments® to provide investment management and fiduciary services, FDIC-insured banking products and services and lending of funds, and the name Vested Interest® to provide non-discretionary defined contribution plan services and investment options through its subsidiary, PNC Bank, National Association, which is a Member FDIC. PNC does not provide legal, tax or accounting advice and does not provide services in any jurisdiction in which it is not authorized to conduct business. PNC does not provide investment advice to Vested Interest® plan sponsors or participants. “PNC Institutional Investments” and “Vested Interest” are registered trademarks of The PNC Financial Services Group, Inc. Investments: Not FDIC Insured. No Bank Guarantee. May Lose Value. ©2014 The PNC Financial Services Group, Inc. All rights reserved. pnc.com/vestedinterest CIB LEG PDF 0514-0130-179613