A Plan Sponsor, in the context of employer-sponsored 401(k) plans, refers to the entity responsible for establishing and maintaining the retirement savings plan for the benefit of its employees. This key player takes on the fiduciary role of overseeing the plan, ensuring it complies with regulatory requirements, and making decisions that impact the plan's features and investment options. The Plan Sponsor can be an employer, a committee designated by the employer, or the organization's board of directors.
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The role of the Plan Sponsor is crucial in promoting retirement security for employees. By diligently fulfilling their fiduciary responsibilities and offering attractive retirement benefits, Plan Sponsors play a pivotal role in helping workers build financial stability for their post-work years.