Not that one in particular, I should hasten to add—one could have the same queasiness about the recent Great-West/US Bank deal (see Great-West Sweeps Up More 401(k) Business ), the sale of Southeastern Employee Benefit Services (see First Charter Lets Go of Recordkeeping Unit ), or just about any structural change at a 401(k) recordkeeper.
The reasons for that angst are obvious, I would suspect. Change—even change for the better—is frequently disruptive to the human psyche. Most of us tend to drift into comfortable “ruts” of pattern, or perhaps habit—places where we know what to expect and, roughly anyway, when to expect it. And, at least in my experience, the more frazzled your existence, the more one pines for these oases of quiet and relative clarity.
There are few things more disruptive to the peace or
clarity of a 401(k) plan than a switch in recordkeepers,
even when the change is instigated by a regular,
thoughtful, focused evaluation of the
alternatives; even when that change is the product of
a desperate quest driven by a truly awful service
But it is perhaps especially disruptive when the change is
thrust on the plan by forces outside of its control or
Particularly because, IMHO, that kind of change calls for
at least a passing review of what the change means to the
Some changes are less impactful than others on the plan’s daily administration, of course. Changes that trigger a mass departure of key staff can be upsetting, and those that necessitate moving to a new processing platform even more so. Change that requires communication to participants is anathema to most plan sponsors (and trust me, when a local provider engages in a big financial transaction, the media will cover it, and participants WILL ask).
On the other hand, changes that are merely structural in nature can be a big yawn—and changes that result in additional resources, better capabilities, a clearer focus, and a stronger commitment to “the business” are not as rare as you might think (though not as common as the post-announcement press releases would have you believe, either).
Regardless of whether the change appears to be good, bad, or inconsequential on its face, you need to ask—and get an answer to—the question “What does this mean to us?”
And the question only you can answer—”What are you going to do about it?”
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