Preparing Your Retirement Plan for a Strong Year-End

As the fourth quarter approaches, retirement plan sponsors have an important opportunity to evaluate their plan's health and position it for a successful year-end. Taking a proactive approach now can help improve participant outcomes, support fiduciary responsibilities, and ensure administrative readiness for year-end deadlines. By reviewing key plan metrics, assessing participant engagement, and identifying action items before Q4, employers can make meaningful improvements while avoiding last-minute challenges.

 

Why a Year-End Review Matters

The months leading into year-end are often busy for HR, finance, and benefits teams. Conducting a retirement plan review before Q4 provides time to identify potential issues, address participant needs, and implement strategies that can positively impact both employees and the organization. A thorough review can help evaluate plan effectiveness, improve employee participant, prepare for compliance and testing requirements and identify opportunities to enhance retirement readiness.

 

Review Key Plan Metrics

Start by assessing your plan's overall performance and participant engagement. Reviewing metrics now allows time to make adjustments before year-end. One of the most important indicators of plan success is employee participation. What percentage of eligible employees are participating? Has participation increased or declined over the past year? Are there specific employee groups with lower participation rates? Low participation may indicate a need for additional education, communication, or enrollment support. We can help with these pain points.

 

Average Deferral Rate

Participation alone does not tell the full story. It's also important to understand whether employees are saving enough. Check your analytics for average employee contribution rates, and percentage of participants contributing enough to receive full employer match. Many participants are surprised to learn that small increases in savings today can significantly improve retirement outcomes over time. Are employees utilizing your match? If your organization offers a matching contribution, determine how many employees are taking full advantage of it. Employees who contribute below the matching threshold may be leaving valuable retirement dollars on the table. Targeted communications can help increase awareness and encourage greater participation.

 

Evaluate Participant Retirement Readiness

Beyond plan statistics, consider whether employees are making meaningful progress toward retirement goals. A growing number of employees may benefit from additional financial wellness resources, retirement planning education, or one-on-one guidance. Take a look at participant account balances, contribution levels by age group, loan and hardship withdrawal activity, and investment diversification trends.

 

Work closely with your retirement plan advisor and investment committee to do document reviews and ensure decisions align with the plan's investment policy statement. Understanding plan costs is a critical component of fiduciary oversight. Review recordkeeping fees, investment expenses, administrative costs and advisor compensation arrangements. Regular fee benchmarking helps ensure participants receive value while supporting compliance with fiduciary obligations.

 

Strengthen Participant Communication

The final months of the year are an ideal time to engage employees and encourage positive retirement-saving behaviors. We can support your team with communications focused on increasing deferral rates, maximizing employer match contributions, understanding investment options and offer other financial wellness resources. Clear, timely communication can help participants make informed decisions before the end of the year.

 

Looking Ahead

The strongest retirement plans don't wait until December to evaluate their progress. By reviewing key metrics, assessing participant engagement, and addressing opportunities before Q4, plan sponsors can improve retirement outcomes while strengthening plan governance and administration. Taking time now to perform a comprehensive plan review can lead to better participant experiences, reduced administrative challenges, and a stronger foundation for long-term success.