1st step in complying with ERISA 404(c)

Participants new to the plan should receive an enrollment packet prior to when they first become eligible to participate in the plan. Enrollment is the first and perhaps most important opportunity to present participants with the mandatory disclosures required by 404(c). It is also a time you have the participant's attention and can encourage the participant to consider the valuable information provided regarding the investment options as it relates to the needs and objectives for that participant.

Enrollment packets should be well organized and include basic education material on the importance of saving for retirement, the value of starting early, the key attributes of the retirement plan offered to the employee (SPD), the basics of investing and building a portfolio, a risk assessment tool, and specific information regarding the available investment options and how elections and changes can be made. Basically, you cover your mandatory 404(c) disclosures at enrollment along with instructions on how to obtain updated and additional information.

It is important to provide ongoing access to updated mandatory disclosure information for all active participants.