As an HR professional, one of your most crucial roles is ensuring that your company’s retirement plan is well-managed, compliant, and provides the best possible options for your employees. When it’s time to evaluate or change your 401(k) retirement advisor, issuing a Request for Proposal (RFP) is a key step in finding the right partner. An RFP helps you gather detailed information from prospective advisors, compare their services, and choose the one that best meets your company’s needs.

Here’s a step-by-step guide to issuing an RFP for selecting a new 401(k) retirement advisor, along with a comprehensive list of questions to consider.

Step 1: Define Your Needs and Objectives

Before drafting the RFP, it’s important to clearly define your needs and objectives for the 401(k) plan. Consider the following:

• Plan Type: Are you looking for a traditional 401(k) plan, a Roth 401(k), or a combination of both?
• Plan Features: Will you be offering features like automatic enrollment, safe harbor provisions, or profit-sharing contributions?
• Employee Needs: Do your employees require additional education on retirement planning? Are you seeking more investment options or specific strategies for retirement income?
• Company Budget: Determine what fees you’re willing to pay for advisory services and plan management.
• Compliance and Regulatory Assistance: Ensure that the advisor will help you stay compliant with ERISA and other regulations.

These factors will serve as the foundation for your RFP and help guide the types of questions you need to ask prospective advisors.

Step 2: Outline Your RFP

A well-organized RFP includes a clear overview of your company, your plan’s needs, and the scope of services you require from the retirement advisor. The RFP should also clearly outline your expectations for the advisor’s role and responsibilities.

Here’s an outline for your 401(k) RFP:

1 Introduction and Company Overview

• Provide a brief description of your company, including size, industry, and the number of employees eligible for the 401(k) plan.

2 Plan Overview

• Describe the current 401(k) plan, including the number of participants, assets under management (AUM), plan features, and investment options.
• Explain the key objectives for selecting a new 401(k) advisor (e.g., improving employee education, reducing fees, enhancing plan performance).

3 Scope of Services

• Outline the services you are seeking, such as investment advice, plan administration, employee education, compliance assistance, and fiduciary oversight.
• Specify any additional services, such as retirement income planning or socially responsible investment options.

4 RFP Process and Timeline

• Provide a timeline for the RFP process, including deadlines for questions, submission of proposals, and the final selection date.
• Clarify any specific instructions for submitting proposals.

5 Evaluation Criteria

• Define the criteria you will use to evaluate the proposals, such as experience, fees, service offerings, and client references.

6 Terms and Conditions

• Include any contractual requirements, confidentiality clauses, or other legal terms that apply to the selection process.

Step 3: Issue the RFP to Potential Advisors

Once the RFP is finalized, send it to a list of potential 401(k) retirement advisors. If you’re not sure where to start, ask for recommendations from trusted sources such as other HR professionals, colleagues in your industry, or benefits consultants. You may also want to contact large retirement plan providers such as Vanguard, Fidelity, or T. Rowe Price, as well as independent advisors or boutique firms.4. Simplified Language and Visual Storytelling

Step 4: Review and Compare Proposals

After receiving the proposals, review each one carefully, paying attention to the details that align with your company’s needs. Compare the services, fees, and approaches proposed by each advisor, and evaluate how well they align with your company’s goals and employee needs.

Step 5: Interview the Finalists

Once you’ve narrowed down your list to the top candidates, it’s time for interviews. These interviews should focus on understanding the advisor’s experience, approach to retirement planning, and willingness to work closely with your company. Ask for case studies or examples of how they’ve helped similar companies achieve their retirement plan goals.

Step 6: Make Your Decision

Based on your evaluation and interviews, choose the advisor that best meets your company’s needs. Make sure to review the contract and any associated fees before finalizing the agreement.

Conclusion

Issuing an RFP for a 401(k) retirement advisor is a strategic move that can help your company provide the best retirement savings options for employees while optimizing plan costs and performance. By carefully crafting the RFP and using the right questions, you’ll be able to identify an advisor that aligns with your company’s needs, ensures compliance, and enhances retirement outcomes for your employees.

To get started, we encourage you to download our 50 sample questions to consider when putting together your RFP.