Our Philosophy

copilotWe believe that fiduciary services should be meaningful, vendor-specific and support the employer.

The principals of Administrative Fiduciary Services Inc. looked at the 3(16) solutions available in the marketplace and did not believe that the available solutions addressed what employers really needed or wanted in a 3(16) administrator.

Some existing 3(16) solutions purported to allow an employer to dump all (or almost all) of his fiduciary responsibility onto a third party similar to a multiple employer arrangement.  We do not believe that this legal argument will stand the test of time, and even more importantly, we do not believe that the ave5rage employer wants to abdicate responsbility for his 401(k) plan.  Employer establish the 401(k) plan for the benefit of their employees, and we believe that most employers want a well-run 401(k) plan and are willing to accept responsibility for the 401(k) plan.

Other 3(16) solutions appeared to us to be little more than window dressing where the employer was getting little more than what they were getting before they signed up for the 3(16) services.  For examples, of the long list of services they were being offered, most of them were already being offered by their provider.

Meaningful – If an employer is paying extra for a 3(16) services, the employer should actually be receiving additional services.  Our 3(16) services go beyond  what typically is provided by a thid party administrator.    Instead, we look to assist the client from the client’s perspective so that the employer does not need to hire another member for their benefits team.  For example, a TPA if asked to review an ADP/ACP test may actually think the best way to review the test is to redo the test and look for differences.  If we believe that the test was originally done by a competent TPA, this approach is unlikely to uncover any errors.  We believe as a 3(16) administrator when we review the ADP/ACP test on behalf of our clients we should do it as if we were a highly skilled professional sitting in the client’s office and review the test as an employer would.  Do the contributions in the ADP/ACP test match what is in our payroll system?  Does the test reflect the correct employees?  Does the test reflect that all of the company’s owners are properly classified as owners?  Has the TPA misunderstood any data that we supplied?  Did we supply the correct data?

Vendor-specific – There is a great variety of a recordkeepers and they each have differnt strengths and weaknesses.  They each offer employers support in different ways.  We offer recordkeeper specific 3(16) packages that complement the service offerings of that recordkeeper.  Our approach uses both the strengths of that particular provider and fills in holes in the products from the employer perspective.  For example, if a particular recordkeeper automatically mails 404a-5 notices to participants with account balances, then why does the employer or 3(16) administrator need to duplicate that task?

Support the employer – Our 3(16) services are designed to support the employer in fulfilling its fiduciary role.  By providing expert assistance, we help the employer better understand and meet its obligations.  Employers are not well served by putting their plan on fiduciary auto-pilot – they are best served by have a competent co-pilot.