The law states that an employee can borrow up to one half of their account balance, and that it must be repaid within five years. When selecting the best plan for your company, you need to decide who will perform each of the core functions. You will also need to decide the availability of loans, hardship withdrawals and other distribution options. It's critical to ensure that employee's monies are correctly allocated to their accounts, especially for participant-directed accounts. All large providers or consulting firms will have computer systems for tracking and administration.
Fees are often negotiable.
Investments can be pooled or participant-directed. You need to take their overall financial sophistication into account. Most firms provide a range of mutual funds with different risk profiles and investment objectives. Showing employees how participation can help them save for retirement will increase participation. Large integrated providers, such as the brokerage firms like Fidelity, Merrill Lynch and Schwab, combine all these capabilities.