FREE White Paper

The Benefits of Mandatory Distributions by Fred Reish

The Benefits of Automatic Rollovers

Fred-Reish-on-Auto-RolloversSmall 401(k) accounts of former employees increase plan costs, expand administrative obligations and extend fiduciary responsibilities.

Plan sponsors should consider distributing these accounts under a well-defined process and regulatory safe harbors, and advisers can provide a valuable service to their clients by educating them on the benefits of mandatory distributions and helping them set up a routine process for sweeping out small account.

This White Paper discusses the reasons for – and benefits of – making mandatory distributions on a regular basis and the regulatory guidance related to these distributions under the Internal Revenue Code (Code) and the Employee Retirement Income Security Act of 1974 (ERISA).