Accreditation Matters

Is your retirement plan’s third-party administrator (TPA)accredited?

When was the last time you looked at your retirement plan? More significantly, who looked at it? Do you really know if your plan is in compliance?

It’s an astonishing fact, but the third-party administrator’s function within the retirement planning industry is not regulated. Literally, anyone can claim to be a TPA. Accreditation is optional, as is licensing. Hard to comprehend how this is the case when more than 90% of tax law relates to retirement plans and yet there’s no formal requirement for a third-party administrator to be licensed. Mind-blowing!

A bad design, or improper administration of a plan, can look fine to unqualified eyes but there are likely hidden issues just waiting to bite back. If the right eyes aren’t on it, there’s a good chance something is going to go wrong. Tax reform happens pretty much every time a new Administration is voted in –is your plan keeping up? Are you taking advantage of the flexibility to discriminate which employees receive which benefits –one size does not have to fit all?

Alarmingly very few retirement plan vendors such as recordkeepers, (even the big brand names) have qualified, credentialed people designing and administering plans. Your retirement plan is one of your biggest assets; it needs regular, expert attention to keep it healthy and keep you out of harm’s way.

When it comes to accreditation the team administering your plan should have at least the basic industry credentials. Here’s a quick overview of accreditation.

The core team should have, as a minimum, basic Accreditation from The National Institute of Pension Administrators and/or the American Society of Pension Professionals & Actuaries Look for qualifications and accreditations that cover the specific type of plan you have, such as:

  • Accredited Pension Administrator (APA)
  • Accredited Pension Representative (APR)
  • Qualified Pension Administrator(QPA)
  • Qualified 401(k) Administrator (QKA)
  • Certified Retirement Administrator (CRA)
  • Certified Retirement Counselor (CRC)
  • Accredited Estate Planner (AEP)
  • Enrolled Retirement Plan Agent (ERPA)
  • Enrolled Actuary (EA)

Also, check to see if the company is CEFEX certified(Center for Fiduciary Excellence). Without the proper accreditation/experience your plan administrators could miss vital changes and make errors leading your plan to be disqualified or, worse still, land you in hot water with the IRS. Penalties for being out of compliance are draconian and can wipe out your entire savings.

It’s time to take a hard look at who is creating and/or administering your plan. Retirement is calling, make sure your plan is in good hands. At CPD only fully qualified, accredited professionals get close to our clients’ plans. We’re fully accredited and CEFEX certified. We’re to help you make retirement work for you.

Accreditation Matters