Why Regular 401(k) Plan Reviews and Audits Are Essential

Managing a 401(k) plan isn’t just about offering retirement savings—it’s about keeping the plan healthy, compliant, and effective for your employees. Regular 401(k) plan reviews and audits help identify issues early, maintain regulatory compliance, and ensure your team’s retirement benefits are truly working for them. At AS Wealth Management Planning, we guide plan sponsors through these critical steps so they can focus on running their businesses with peace of mind.

Why It’s Important to Review Your 401(k) Plan

A 401(k) plan review is a thorough check-up on your plan’s design, investment performance, and compliance with current IRS and Department of Labor (DOL) rules. Consistent reviews can help you:

1. Stay Compliant with Regulations
   Rules under ERISA and SECURE 2.0 change frequently, and missing updates can mean penalties or even plan disqualification. Regular reviews help you stay aligned with these requirements.

2. Spot and Correct Errors Early
   Common issues like delayed contributions, misapplied employer matches, or eligibility mistakes can lead to fines. Reviews allow you to detect and resolve them before they escalate.

3. Ensure Investments Are Performing Well
   Reviewing investment options and fees ensures your employees have access to diversified, cost-effective choices that support long-term growth.

4. Manage Fees and Control Costs
   High administrative or fund fees can quietly erode retirement savings. A review highlights areas to renegotiate or optimize costs.

5. Encourage Better Employee Participation
   Reviewing plan participation trends helps identify opportunities for features like automatic enrollment or employee education programs that boost engagement.

What a 401(k) Audit Brings to the Table

While plan reviews are broader, 401(k) audits provide a deeper dive into your plan’s compliance and accuracy. Large plans with over 100 participants are required to have annual audits, but AS Wealth Management Planning recommends periodic audits for all plans. Audits help:

• Confirm contributions are processed accurately and on time

• Verify compliance with ERISA and DOL rules

• Evaluate the performance of record keepers and other providers

• Document that fiduciary responsibilities are being met

How Often Should You Review and Audit Your Plan?

Most experts, including AS Wealth Management Planning, recommend reviewing your 401(k) plan at least once a year. Large plans may require annual audits, while smaller plans can audit every two to three years—or sooner if there are major changes, like rapid company growth or mergers.

Routine reviews and audits can:

• Reduce the risk of penalties and audits

• Keep investments competitive

• Control administrative and investment costs

• Boost employee trust in the plan

Why Work with AS Wealth Management Planning

Our team at AS Wealth Management Planning takes a hands-on approach to plan reviews and audits. We:

• Assess plan design and suggest improvements for efficiency

• Benchmark fees and provider services

• Identify compliance gaps before they become problems

• Offer guidance to enhance employee education and participation

By partnering with us, you get expert support that protects your business and helps your employees reach their retirement goals.

Final Thoughts

Routine 401(k) plan reviews and audits are about more than just checking boxes—they’re an investment in the health of your retirement plan and the financial security of your team. With AS Wealth Management Planning by your side, you can keep your plan compliant, cost-effective, and well-positioned for long-term success.