All of us!
Even before the financial challenges brought on by COVID-19, retirement saving for workers in the US was insufficient—and in fact, worsening.
For example, data from 2014-2017 shows that only 40% of employers were providing retirement coverage for workers. Read More.
Small business owners face the particular challenge of setting up their own retirement plans—while encouraging employees to do the same. Though we all know that the sooner we start saving, even modestly, the better off we will be in our longer, older ages, the constraints of time, resources and knowledge contribute to inertia.
Getting Started: Consider a Plan Administrator
As a small business owner, you can be exemplary: start a retirement plan for yourself and your employees. Doing so will make your business stand out!
Consider getting started by contracting with a third party plan administrator. As Investopedia describes:
Third-party claims administrators may manage employee retirement programs such as 401(k) plans. In such cases, the company is often owned or managed in part by an investment company. The investment company handles the money management and the third-party administrator handles the day-to-day account operations and customer care functions.
Protecting Retirement Plans: Comply With ERISA!
When your business sponsors a retirement plan, you become responsible for protecting the hard earned savings invested in it. You’ll need to comply with ERISA in doing so.
What is ERISA?
The Employee Retirement Income Security Act (aka ERISA) originally became a federal law in 1974. It has since been updated several times. Simply put, the purpose of ERISA is to safeguard retirement savings from mismanagement and abuse.
For example, according to the Department of Labor, ERISA:
- Requires plan sponsors to provide plan information to participants
- Establishes standards of conduct for plan managers and other fiduciaries
- Enforces the protection of plan funds—even if a company goes bankrupt
- Requires transparency and accountability
Importantly, one of ERISA’s specific requirements is that plan sponsors obtain fidelity bonds—known as ERISA bonds to protect the plan from losses due to fraud or dishonesty. A few examples of fraud and dishonesty include theft, embezzlement, forgery, misappropriation, wrongful conversion, willful misapplication.
Obtain The Required ERISA Fidelity Bond!
It is scary to think about misappropriated retirement funds! The good news is that Colonial Surety Company is here with help—especially for small businesses.
At Colonial, we understand the demands on the time and talent of small business owners. That’s why we make it easy to directly and quickly obtain ERISA bonds to protect your plan. We even offer packages so that you can add on Fiduciary Liability coverage to protect yourself too!
Our unique packages also include Cyber Liability coverage for your plan—which businesses are finding increasingly important.
Choose the right package for your business, right now, via Colonial Surety Company’s unique, direct, online service. You are just a few clicks away!
With Colonial Surety Company you get 70 years of experience—and direct to consumer digital purchasing too. Experience the best of both right here: Get your ERISA bond package now!