Michigan Chamber Multiple Employer 401(k) Plan
Competitive Advantage. Businesses can utilize this program to enhance their benefits package to attract and retain quality employees.
Save Money. The MiMEP can negotiate lower fees from service providers based on large participant numbers and account balances.
Save Time. Our team of financial experts will complete the necessary paperwork and handle all the administrative details.
Create Efficiencies. The operational, transaction and reporting functions are transferred to a third-party, thereby reducing fiduciary and financial risk.
As a small business owner, attracting and retaining quality employees give you a competitive advance and allow you to provide financial stability to your workforce.
Frequently Asked Questions
What is a MEP?
- MEP is short for Multiple Employer 401(k) Plan where many small businesses can join and be part of a 401(k) that is similar a Fortune 500 company’s 401(k). A MEP is a robust turnkey plan with low cost, monitoring and selection of investments, along with transferring the risks to a third party.
Who is eligible to join the MiMEP?
- A company that is a member of the Michigan State Chamber of Commerce.
Does my company need its own IRS determination letter?
- No. Your company adopts the lead employer (Michigan Chamber of Commerce’s 401(k) plan), therefore, the IRS reporting is handled by the lead employer.
If the Michigan Chamber is the lead employer of the MiMEP, what is every other company that joins called?
- Each employer that joins is referred to as an adopting employer into the MiMEP. Your company’s responsibilities are limited to providing payroll/census data for your employees.
Who is responsible for year-end reporting (form 5500, testing, etc.)?
- A single annual 5500 report will be filed by the lead employer, the Michigan Chamber of Commerce for all the MiMEP adopting employers. Newport Group (the MiMEP record keeper) is responsible for completing the year-end testing of each adopting employer in the MEP.
Who is responsible for the administrative duties, recordkeeping, etc.?
- Newport Group (record keeper) will act in the fiduciary capacity performing 3(16) services of the MiMEP. In simple terms, Newport will take the daily administrative duties/tasks of handling your plan off your human resource manager. It allows your HR manager to focus on other areas of your business.
What responsibilities will our company have to operate the plan?
- The operational responsibilities for your company’s plan are limited to providing accurate census/payroll data to Newport Group.
Who do we contact if we need help?
- You will have a dedicated Account Manager at Newport Group, along with a team of Investment Professionals at Tri-Star Trust.
Who has fiduciary liability?
- Newport Group will sign on as directed trustee of the MiMEP and handle the 3(16) services while Tri-Star Trust will be your company’s investment fiduciary.
Who is responsible for the investments of the MiMEP?
- Tri Star Trust will be investment fiduciary and have the responsibility of selecting and monitoring appropriate investment choices for the MiMEP.
What investments are available?
- Each participant has the freedom to choose how they want to invest:
- Pick from 22 individual investment fund options
- A series of target-date investment fund options
- Pre-selected model portfolios options based on your risk tolerance and retirement goals.
What are the benefits of a MEP vs. a stand-alone plan?
- A MEP is cost-effective for many small companies, along with creating operational efficiencies in administering a 401(k) plan. In addition, you transfer the fiduciary responsibilities to a third party (Newport Group and Tri-Star Trust)
How much will this cost me and how does that compare to a stand-alone plan?
- The cost varies per employer based on the number of employees, but it is safe to say, it is usually a 40% cost savings from a stand-alone plan.
What is the advantage of a MEP 401(k) vs. a SIMPLE IRA?
- A 401(k) plan is a widely recognized retirement plan for hiring talented, skilled individuals in our tight labor market. Companies that offer a 401(k) have a competitive advantage in hiring talented candidates.
Can my company’s plan be tailored the way I want it or does it have to adhere to the rules of the Michigan Chamber’s plan?
- Yes. Your company can design a plan that is right for you. You can have several different plan designs from other adopting employers in the MiMEP. For Examples: different match scenarios, loans vs no loans, eligibility etc. You select the options that best fit your company.
What happens to my plan, if one of the other company plans fails with compliance?
- Because each individual adopting employer is tested individually, there no testing results of any single employer that affects any other employer within the MiMEP.
What are the benefits of being a member of the Michigan Chamber?
- There are many benefits to being a member of the Michigan Chamber of Commerce. I would encourage you to visit the Michigan Chamber of Commerce website and review the listing of membership benefits.
I am already a member of my local chamber, do I still need to be a member of the Michigan chamber?
- Yes. You need to be a member of the Michigan Chamber of Commerce to be able to join the MiMEP. Currently, they are offering a discounted membership fee.