For employers: 401(k) and retirement plans
A plan is judged by its process, not its fund list.
ERISA holds a plan sponsor to the standard of a prudent expert, and courts and the Department of Labor read that standard as a question about process: how the investments were chosen, what they cost, and how they have been monitored since. We serve as the plan-level investment consultant for small and mid-size employers. That means the investment policy statement, the fund menu, the fee and share-class review, participant education, and coordination with the recordkeeper, third-party administrator, and ERISA counsel who run the rest of the plan.
The situation
Someone has to own the investment side of the plan.
Most company plans arrive bundled. A payroll provider or recordkeeper set it up, a fund lineup came with the package, and the owner or HR lead who signed the paperwork became the plan’s fiduciary the same afternoon. Years later the lineup is still the one that came in the box, nobody can say why a given fund is there, and the fees are paid out of participant balances where no one sees them.
That arrangement is common, and it is the sponsor, not the provider, who is responsible for it. Hiring a recordkeeper is itself a fiduciary decision, and the duty to monitor what was hired stays with the employer. The Department of Labor’s own guidance puts the point simply: prudence focuses on the process for making fiduciary decisions, so the decisions and the basis for them should be documented.
Our role is to give that process a professional owner. We hold the investment side of the plan, write it down, and keep it current, so the company can answer the two questions every sponsor eventually faces: why these investments, and what do they cost.
Why it’s complex
Five decisions every sponsor makes, whether or not anyone is watching
Which funds, and why
A menu should cover the major asset classes without duplicating them, hold each fund to written criteria, and record why each is there. A lineup that grew by accretion cannot answer that question; a lineup built from an investment policy statement can.
Read the guideWhat the plan pays, and who pays it
Fund expense ratios, revenue sharing, recordkeeping charges, and advisory fees can land on the company, on participant balances, or on both. ERISA requires the fees to be reasonable, not lowest, and reasonable is a judgment the sponsor must be able to show it made.
Read the guideWhere the default money goes
Automatically enrolled participants land in the plan’s default investment, usually a target-date series, and most stay there. Choosing that default is the single largest investment decision a sponsor makes, and it deserves more than the recordkeeper’s house option by default.
Read the guideSafe harbor, match, Roth, auto-enrollment
Plan design decides who benefits and what the company must contribute. A safe harbor match of 100% of the first 3% deferred plus 50% of the next 2% removes annual testing at a known cost; a Roth source is now required if higher earners want to make catch-up contributions at all.
Read the guideThe owner’s own account
For many owners the company plan is the largest tax-advantaged account they will ever hold. Total 2026 additions can reach $72,000 before catch-ups, and the design that serves the workforce should also serve the people who built the company.
Read the guideSources: IRS Notice 2025-67 and IRS IR-2025-111; SECURE 2.0 Act of 2022 (P.L. 117-328), §101; IRS, Retirement plans startup costs tax credit (IRC §§45E, 45T); ERISA §404(a), 29 U.S.C. §1104; DOL EBSA, Service Provider Disclosure Regulation (ERISA §408(b)(2)); DOL EBSA, Meeting Your Fiduciary Responsibilities.
Our approach
How an engagement runs
We work at the plan level, for the sponsor. The recordkeeper keeps the accounts, the third-party administrator runs testing and the annual return, and ERISA counsel drafts and amends the plan document. We own the investment side and coordinate with each of them, and we do not provide legal or tax advice. The steps below are the order we work in with a company that already has a plan; for a company starting one, the first two steps happen before the plan is signed.
Read the plan as it is
We collect the plan document and adoption agreement, the current lineup, the recordkeeper’s §408(b)(2) fee disclosure, the participant fee notice, and the last Form 5500. From those we build one page that shows every dollar the plan pays and who pays it, and a fund-by-fund review against written criteria. Most sponsors have never seen their plan on a single page.
Write the investment policy statement
The IPS is the document a sponsor is measured against. It sets the asset classes the menu will cover, the criteria for selecting and keeping a fund, the process for placing one on watch and replacing it, the standard for the default investment, and how often the committee meets. It is written so a new owner or a new HR lead could pick it up and run the plan.
Rebuild the menu and the share classes
With the IPS in hand we design the lineup: a core set of index and actively managed options across the major asset classes, a default investment chosen on its glide path, cost, and construction rather than on convenience, and the lowest-cost share class of each fund the plan qualifies for. Changes go to the recordkeeper with a written rationale, and any revenue-sharing arrangement is either eliminated or credited back to participants.
Educate the people in the plan
Participant education is part of the engagement, not an add-on: enrollment meetings, an annual session on the plan and its investments, and one-on-one time for employees who want it. For owners and key employees, the company plan is also where their personal planning meets the firm’s wealth-management work, including the Roth catch-up rule that now applies to anyone who earned more than $150,000 from the company in the prior year.
Monitor, document, repeat
Each quarter we score every fund against the IPS criteria, maintain the watch list, benchmark total plan cost, and deliver a written report the sponsor can file with the meeting minutes. That file is the evidence of process ERISA asks for. The committee mechanics, fiduciary training, and minute-taking live on our fiduciary education and oversight page.
The work
What you’ll work through with us
- A written investment policy statement, adopted by the sponsor and reviewed annually
- A one-page plan cost summary: every fee, its source, and who bears it, with a benchmark
- A fund-by-fund review against the IPS criteria, with a documented rationale for each holding
- Menu design and share-class review, with change recommendations delivered to the recordkeeper in writing
- A default-investment analysis covering glide path, cost, and construction
- Quarterly monitoring reports and a maintained watch list, formatted for the plan’s fiduciary file
- Enrollment and annual education sessions for participants, and one-on-one meetings on request
- Plan-design analysis on safe harbor, matching, Roth, and auto-enrollment questions, coordinated with the TPA and ERISA counsel who implement them
- Coordination among the recordkeeper, TPA, payroll, and counsel, with the sponsor copied on every recommendation
Retirement plan consulting at the firm is led by Theo Halbardier, CFP®, CIMA®, CAIA®, the firm’s founder. The CIMA® curriculum is investment policy, manager selection, and monitoring, which is the work a plan menu depends on; the CFP® work is what the plan means to each employee’s own retirement. We are fee-only: no commissions, no product sales, and no payments from fund companies or plan providers. About Theo
Questions
Common questions from plan sponsors
What does a 401(k) investment consultant do that the recordkeeper does not?
The recordkeeper keeps accounts, processes contributions, and runs the website; it is a service provider, and its lineup is often built around its own products. An investment consultant works for the sponsor: writing the investment policy statement, designing and monitoring the fund menu, reviewing fees and share classes, and documenting the process ERISA requires. The recordkeeper, the TPA, and counsel stay in place; we coordinate with them.
Do you act as a fiduciary to the plan?
Where we act as a fiduciary to an ERISA plan we do so under ERISA, and our written §408(b)(2) disclosure states our services, our fiduciary status, and our compensation before any engagement begins. ERISA describes both advisory (§3(21)) and discretionary (§3(38)) investment fiduciaries; which role, if any, we hold for a given plan is set in the written agreement. The sponsor’s own duty to select and monitor us remains in every case.
How are you paid?
By a fee set in the written engagement and disclosed at the plan level before we start, as ERISA §408(b)(2) requires. We receive no commissions, no revenue sharing, and no payments from fund companies, recordkeepers, or any other provider, so a fund never earns a place on the menu by paying for it.
Should we choose a safe harbor 401(k)?
Often, when owners and higher earners want to contribute the maximum and the company would rather make a known contribution than risk failing the annual nondiscrimination tests. The basic safe harbor match is 100% of the first 3% an employee defers plus 50% of the next 2%, or a 3% contribution to everyone eligible, fully vested. We model the cost against the payroll and the TPA writes the design into the plan.
Does our new plan have to auto-enroll employees?
Most 401(k) plans established after December 29, 2022 must, for plan years beginning after December 31, 2024. The initial rate must be between 3% and 10% of pay, rising 1% a year to at least 10% and no more than 15%, and employees can opt out. Companies less than three years old, employers with 10 or fewer employees, and church and governmental plans are exempt. The default investment those contributions land in is the decision we help the sponsor get right.
Do we need a Roth option?
In practice, yes, if anyone in the company earning more than $150,000 wants to make catch-up contributions. Since January 1, 2026, catch-ups for employees whose prior-year wages from the company exceeded that threshold must be Roth, and a plan without a Roth source cannot accept them. Beyond that rule, a Roth source gives every participant a second tax bucket to draw from in retirement.
What do you need from us to start?
The plan document, the current fund lineup, the recordkeeper’s fee disclosure, and the most recent Form 5500, if there is one. From those we can show the plan on a single page within a few weeks. For a company without a plan yet, the first conversation covers the workforce, the budget for contributions, and what the owners want the plan to do for them.
Reviewed by Theo Halbardier, CFP® · Updated September 2026 · Figures current for 2026
Tell us about the plan you have, or the one you are considering.
The first conversation is 30 minutes. Bring the fund lineup and the latest fee disclosure if they are handy; no preparation needed.
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