The Value of Dynamic Retirement Plan Design

As an employer, you may face challenges regarding retirement contributions. Our team of experts can help you understand your options.

What will you remember about the COVID-19 pandemic of 2020? Perhaps when reflecting back, you may recollect the paper hearts hung in your neighbor’s windows, the herculean efforts of our healthcare workers, or a time of reconnection with immediate family. All of these are powerful, positive effects of the pandemic. However, as a leader within your company, it is likely that not all experiences remembered from 2020 will be positive. This period will likely be marked as a stressful and unforgiving time of uncertainty for many.

As we look to the impact on the retirement industry, we saw the implementation of the Coronavirus Aid, Relief and Economic Security (CARES) Act. The Act not only included financial stimulus to our economy, but also provisions designed to help participants in retirement plans. Heartland Retirement Plan Services was among the first retirement plan providers in the nation to develop procedures and offer the new provisions to our plan sponsor partners. The requests from plan participants to take advantage of the new provisions have begun in earnest.

What Does This Mean for Your Plan?

The CARES Act certainly helps address an immediate need for participants affected by the virus. However, it does not address retirement plan employer contribution challenges that an employer may be facing. Based on experiences in working with employers through the 2008 financial crisis, we anticipate that we may see the retirement plan is likely to come under pressure again.

Custom plan design is a longstanding hallmark of our collaboration with our plan sponsor partners. Periods of stress which require resiliency and creativity often bring out the value in working with our team through plan customization. Every company’s situation is different and should be reviewed individually. Consider the table below which includes the most common types of employer contributions.

Employer Contribution Discretionary Match/Profit Sharing Fixed Match/Profit Sharing  Safe Harbor Match/Profit Sharing
Flexibility to Suspend             Very flexible Moderately flexible Typically, not flexible
Plan Amendment Required if Suspending     Not typically Yes Yes
Participant Notice Required if Suspending No, but may be a favorable practice Yes Yes
Required Notice Period Before Suspension Begins No Yes, 30 days Yes, 30 days
Specific Criteria Must be Met in Order to Suspend No No Yes
Effect of Suspending on Nondiscrimation Testing Little to no effect Little to no effect Potentially extensive

Let Us Help You

Our team of experts is here to help navigate tough decisions by offering in-depth consulting with regard to your company’s retirement plan, specifically relating to 2020 and 2021 employer contributions. To begin a 360-degree plan design review pertaining to employer contributions or other provisions within your company’s retirement plan, contact your plan’s HRPS relationship manager directly, call 800.399.2083 or email

Our team of experts is here to help.
Contact us today.

Products offered through Heartland Retirement Plan Services are not FDIC insured, are not bank guaranteed and may lose value, unless otherwise noted.