Designing a Retirement Benefit Plan to Support Growth and Employee Wellbeing

THE SITUATION

Baker Werks is a growing software company specializing in software as a service in the real estate industry.  Their employee headcount has grown from 500 to over 800 within the past two years.

Baker started an employer-sponsored 401(k) plan ten years ago based upon the executive team's needs and at the request of their employees. 

Since implementation, the plan has not grown, and participation has been low.  The company has never offered a matching contribution, and the plan advisor has only been on-site twice over the ten years to explain the benefits of the plan.

THE CHALLENGE

Both the CFO and HR Manager, who share responsibility for managing the plan, want to create a retirement benefit plan that acts as a magnet to attract and retain top talent in their growing business. 

They needed a professional advisor to help them:

1. Increase employee participation
2. Explain the benefits that a retirement plan can bring to their employees
3. Integrate a plan with their current payroll provider
4. Lower the plan costs for both the company and employees
5. Reduce the complexities of managing the plan as a fiduciary

THE REFERRAL

Baker Werks was referred to TAMMA Capital by an HR consultant who had previously worked with Paul Fenner.  Before founding TAMMA, Paul had a 20-year corporate career in accounting, finance, and operations serving as Director of Finance and CFO.  Baker was impressed with Paul's knowledge, empathetic approach, and understanding of their business and roles given his prior background.

TAMMA FAMILY OFFICE EXPERIENCE

Through a series of conversations with Baker Werks, TAMMA created a new Safe Harbor 401(k) plan with our partners at Vanguard, which resulted in the following:

• Assisted Baker in determining the most appropriate employer match that would help increase employee participation while staying within their company budget.
• Put together an annual series of educational events both in-person and online that not only explained what the new plan benefits and cost-savings were but had a focus on supporting employees with their personal finances that would help reduce workplace stress.
• Engaged the dedicated support team at Vanguard to help integrate the new 401(k) plan with their payroll service provider, which reduced the long-term administrative burdens of maintaining the plan.
• Developed a low-cost investment fund lineup, which decreased Baker's plan costs by 60%.  By passing along most cost savings onto the employees, Baker increased plan participation further.
• Developed customized and simplified plan option specifically for Baker, coupled with Vanguard handling compliance tasks and testing, saved both the CFO and HR Manager time.

OUTCOME

With a new retirement plan in place and retirement plan growth initiatives that supported their growth initiatives, Baker could focus its energy on continuing to grow, knowing that it had a benefit plan in place to help attract and retain top talent.  The CFO and HR Manager have the peace of mind knowing they have a fiduciary partner in TAMMA, who is looking out for their best interests while helping to support their employee's financial well-being.

* All names have been changed. A client or prospective client should construe no portion of the content as a guarantee that he/she will experience the same or certain level of results or satisfaction if TAMMA Capital is engaged to provide investment advisory services.