2020 PLAN SPONSOR OF THE YEAR
Corporate 401(k) $25MM–$50MM

Ace Precision Machining Corp.

FINALIST
Sheri Eubanks
Vice President of Operations
Kristin Joyce
Controller
  • Plan(s)
    401(k)
  • Total Plan Assets
    $27.3MM
  • Number of Participants
    293
  • Participation Rate
    94%
  • Average Deferral Rate
    7.3%
  • Default Deferral Rate
    4%
  • Default Investment
    T. Rowe Price target-date funds
  • Automatic Enrollment
  • Automatic Escalation
    Not applicable
  • Employer Contribution
    25% of 8% + possible profit sharing
  • Provider(s)
    Recordkeeper, OneAmerica; Adviser, OneAmerica Investment Advisory Services
  • Financial Wellness Educator(s)
    BMO Harris Bank at Work; Peter Dunn—aka “Pete the Planner”


If the sponsor sees that plan participation is declining, it performs a re-enrollment; one done a year ago January brought participation up to 94%.

Ace Precision Machining Corp. in Oconomowoc, Wisconsin, doesn’t believe in being too “preachy or paternalistic” about its 401(k) plan, which it started 30 years ago. That’s why, when the manufacturer and re-manufacturer of highly engineered aircraft, military and land-based gas turbine engine components recently decided to reduce allowed participant loans from two to one, it made sure to couple it with a strategy that empowers participants to achieve financial wellness.

About 25% of participants had an outstanding loan or two before the company effected its new policy, at the start of last year. But limiting loans was just part of the equation; after all, people can figure out how to get a loan if they think they need one. So the sponsor decided to complement this change with education, as well as targeted communications.

“So by [our] limiting the loans, participants are keeping more money in their 401(k), and at the same time we’re using these educational programs … to help them see how their finances in their personal lives can affect their 401(k), as well,” says Kristin Joyce, controller at Ace Precision.

To that end, the sponsor works with adviser OneAmerica Investment Advisory Services LLC and recordkeeper OneAmerica, which uses the financial program of Peter Dunn—aka “Pete the Planner.”

“When you talk about financial things, you’ve got a very short span of attention to work with,” so the communication is “concise and relevant,” whether it’s flyers or short videos, says Joel Michel, relationship manager, retirement services at OneAmerica. The sponsor also uses the BMO Harris Bank at Work program, which includes a series of on-site meetings about how to create a basic budget, how to save while managing debt, and what to know about taking out a mortgage or car loan.

“We want to make sure employees are aware of the resources available to them,” Joyce says.

Education and communication include everything from biannual one-on-one meetings with OneAmerica financial advisers—including educational consultant Debra Avery—to lunch-and-learns, to 401(k) Day, in which participants could earn a PayDay candy bar by logging in to their OneAmerica 401(k) account.

Plan design changes have also played a role in participant outcomes. In 2016, when the participation rate was 79%, the sponsor added automatic enrollment, at 4%, into a designated T. Rowe Price target-date fund (TDF), once an employee met eligibility requirements. The result of a re-enrollment, which took place a year ago January 1, was a jump in participation to 94%, with an average deferral rate of over 7%.

Average account balances also increased more than $40,000 in the past decade.

The sponsor keeps an eye on the participation rate and performs a re-enrollment as needed “if we see that participation [is] slipping,” Michel says.

Throughout the year, the sponsor makes sure to maintain employees’ interest in the value of the 401(k) plan through various communication strategies and activities.

“We try to really help employees understand that; … we try to position them very well for the future,” Joyce says.

Plan participants may contribute up to 50% of pre-tax annual compensation, and the company has the option to make discretionary matching contributions. The current match is 25% of the first 8% of eligible compensation, in addition to discretionary profit sharing, which has consistently been given. Participants in the 401(k) plan are fully vested in the company’s matching and profit-sharing contributions after six years. 

Whether it’s staying on top of the most current 401(k) regulations, adding a different type of fund to the investment lineup, reducing fees or adjusting plan design, Joyce says, the sponsor is always open to “anything we could be doing better that helps our employees prepare for retirement.”

Michel describes the sponsor as “patient” when it comes to decisions about investments, which can benefit participants if a fund turns its performance around. “They don’t have knee-jerk reactions when a fund may have a quarter where it underperforms,” he says.

 —Corie Hengst

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