Terminating a retirement plan takes a lot of work, a lot of planning and requires specializedskills.

Not surprisingly, most fiduciaries choose to outsource plan terminations to service providers.

Selecting an outsourced provider is a critical decision. To helpsimplify the process, we suggest using the five criteria below (andscroll down to watch the video that discusses those key criteria)for selecting a plan termination services provider:

1. Check that the provider delivers a full range ofservices including the following:

• Mailing of required participant notices

• Participant address verification

• Multi-lingual call center support for respondingparticipants

• Safe Harbor IRAs for unresponsive participants

2. Confirm the provider has expertise in locatingmissing participants.

The DOL is very specific about what is required if a participantis deemed to be “missing”. When selecting an outsourced providermake sure they have a proven track record of fulfilling thoserequirements including the following:

• Verification of/updates to participants’ last best-knownaddress

• Locating beneficiaries of deceased participants

• Utilization of multiple web-based resources

• Oversight of USPS Certified mailing

3. Provider should focus on minimizing cash outs andpromoting account consolidation.

Unfortunately, many participants will be tempted to cash outtheir retirement savings during a plan termination.

To help reduce cash outs and increase retirement accountconsolidation to an existing account, like a new employer’s plan,make sure the provider has professionals who will providedistribution counseling.

4. Be sure the provider offers fiduciary-friendly SafeHarbor IRAs and on-going account support.

• Continuous efforts made to locate missing accountholders

• Straightforward, easy-to-understand fee structure

• Monthly account maintenance fee vs. annual fee

• No lock-up provisions

• Ability to move assets to more suitable investment options

• Account consolidation assistance

5. Make sure the provider has a proven trackrecord in facilitating plan terminations.

• How long they’ve handled terminating plans

• The number of terminating plans they’ve worked with

• The mix of large vs. small plans

This is the third video of a three-part series on DC planterminations, presented by Mike Wilder, Vice President of ClientServices, Retirement Clearinghouse.