Collect and maintain copies of beneficiary designations and changes to same.
Commentary: Many vendors and third party administrators (TPAs) handle this function, as well as putting named beneficiaries on participants’ accounts and reminding participants periodically that they should review who they have named.
The TPA would also maintain the actual paper copies with wet signatures, should the state where the employer does business have the “best evidence rule,” which requires the original signed forms to be maintained. Also, if the state is a community property state, there will be a requirement for spouses to sign off on the naming of beneficiaries other than the spouse.
Editor’s Note: This tip is taken from the “Checklist for establishing, amending, and restating a 403(b) plan NTSA Advisor” that appears in the “Administration Basics Non-ERISA 403(b) for Public Schools” section of the 403(b) Plan Sponsor Guide.
The 403(b) Plan Sponsor Guide is part of the NTSA Certified Retirement Education Specialist (CRES) materials. The NTSA Certified Retirement Education Specialist (CRES) program and designation has been developed in order to equip advisors to be qualified and available to teach the NTSA educational program, which is designed to provide teachers with the basics of planning for retirement and improve their retirement readiness. More information about CRES is available here.
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