Frequently Asked Questions (FAQs)

The following are the answers to some of the Frequently Asked Questions

Who is my Plan Administrator?
Your Plan Administrator is the individual at your current/former place of employment that handles the day to day operation of your retirement plan. Any and all inquiries regarding your retirement plan should be directed to this individual.

What is a Summary Plan Description?
The Summary Plan Description is a document containing a comprehensive description of your retirement plan, including the terms and condition of your participation. The summary plan description is a valuable tool in understanding all aspects of your plan and a copy is available to you from your Plan Administrator.

When can I begin contributions to my 401(k) plan?
Each retirement plan has different provisions governing participation. These provisions are outlined in the Summary Plan Description. Upon completion of the eligibility requirements, a participant may begin contributions on the following entry date.

What is an "entry date"?
An entry date is the specific date upon which new participants may commence their elective contributions. Please consult your Summary Plan Description for more details.

What is the difference between employer matching and profit sharing contributions?
Employer matching contributions and profit sharing contributions are both employer contributions made into the plan on behalf of its participants. However, they differ in the calculation of the contribution amount for each.

Employer matching contribution amounts depend on the elective contribution made by each individual participant in a given plan year. An example of this would be a plan that makes a matching contribution of 25% of any elective contributions. Therefore, if a participant elected to contribute $1,000.00 from their salary into the 401(k) plan the employer would contribute $250.00 on their behalf.

Profit sharing contribution amounts depend on the compensation earned by a participant in a given plan year. An example of this would be a plan that makes a profit sharing contribution that is 3% of a participant's W-2 compensation for the plan year. Therefore, if a participant earned $50,000.00 the employer would make a profit sharing contribution in the amount of $1,500.00.

Qualified Plans is not a typical Third Party Administrator . . . they offer much more than that! They helped us design a plan that would best suit our needs as a corporation as well as handling the implementation our 401(k) plan. We have used their consulting services on many occasions.
Faye L. McCorkle
The Benefit Company