The Retirement Plan industry is constantly dealing with the complexity of keeping records up-to-date and accurate. Handling fiduciary risks while managing the ever-increasing data adds to their burden. They cannot risk being non-compliant, as the consequences can be severe.
Non-compliance can invite expensive audits and penalties for violating the fiduciary responsibilities defined by the Employee Retirement Income Security Act of 1974 (ERISA).
Compliance Testing is one of the essential steps in ensuring that your retirement plan remains compliant. But, the results of 401k plan Compliance Testing rely on the data provided. Thus it is essential to ensure data accuracy.
Automation of retirement plan administration helps relieve the pain points like payroll file processing during onboarding by reducing manual errors. The submission and conversion process of payroll files received from plan sponsors, payroll providers, and third-party administrators is tedious. Beyond the immense manual effort, compiling the various formats leads to several errors in the data. Besides reducing risks associated with ERISA, retirement plan administration automation is also a cost-effective method.
It is essential to understand that not all 401k plan administration software is built equal. Some come with basic functionality, while others offer intelligent automation. Reducing fiduciary risks requires more than just basic functionality.
Essential automation platforms involve a semi-manual process for 401(k) plan and payroll data administration. The process is error-prone as it involves manual entry and validation of the retirement plan data.
An intelligent automation platform offers a frictionless 401(k) plan recordkeeping system that allows free data flow and seamless information synchronization across the payroll and 401(k) recordkeeping systems.
Even contribution funding and money transfer processes are conducted automatically. The AI algorithm continuously conducts data accuracy checks and reduces risk. It identifies and flags potential errors to ensure that only the correct contribution amount is transferred to the plan.
Automation is imperative to streamline your plan fiduciary responsibilities in line with ERISA. Here are a few things to look out for when choosing an automation platform for your retirement plan administration requirement:
- Delivers accuracy: Automating your 401k plan Compliance Testing will only be risk-free and generate the desired results when you select a platform that offers comprehensive automation. Only a fully automated process with minimal human intervention can reduce errors. The continuous synchronization of data and transaction tracking ensure more efficient records management. The conditional programming improves compliance services through automatic updating of data and error detection.
- Comprehensive solution: An essential automation tool will not be able to address all requirements of the retirement plan administration process. It is better than legacy systems but does not eliminate the need for DOL audits or voluntary corrective programs. A comprehensive solution that uses intelligent automation eliminates errors from the retirement payroll data. Deploying retirement and pension management software powered by advanced technologies such as artificial intelligence and machine learning helps predict and prevent discrepancies.
- Reduces work: Manual oversight of administrative tasks increases fiduciary risks, and a high cost is also incurred in conducting audits. Picking the right retirement plan automation platform takes the burden off your workforce. A self-configuring system delivers timely compliance test results and consumes less time than traditional automation tools.
Automation in the retirement plan industry must eliminate time-consuming manual processes. Opting for retirement plan administration software allows you to manage the data complexity and avoid penalties for non-compliance.
Congruent Solutions equips its retirement plan administration software with advanced technologies. Powered by technologies such as AI and ML, Congruent’s CORE platform is a retirement plan automation system that prepares your organization for the future. Ensuring data accuracy without any redundant data entries, CORE helps transform your governance process through intelligent automation. Our team evaluates and interprets new regulations and trends in the retirement industry to keep your systems up to date for compliance. Improve outcomes for your plan participants while mitigating risks; contact our experts for a quick upgrade.