Date: Jan 26, 2021
Magazine:
January/February 2021

By Matthew Lewis, President, Western Growers Financial Services

For all the challenges 2020 brought our industry, country, and world, the year was also marked by the 20th anniversary of Western Growers Financial Services (WGFS), a registered investment advisor and broker-dealer that currently manages more than $300 million in client and corporate assets.

Since it was first established in 2000, WGFS has been driven by the same mission that has guided the Western Growers Family of Companies for nearly a century: To provide quality products and services that enhance the competitiveness and profitability of our members.

Unlike publicly traded companies or independent money management firms, we do not answer to shareholders, nor are we motivated by increasing our profits to the virtual exclusion of anything else. Instead, we serve the interests of our members, and understand that we must daily provide both service and performance that exceeds alternatives in the marketplace.

With this purpose in mind, we are pleased to announce a new 401(k) administrator and custodian for our Western Growers Retirement Security Plan (RSP). After a competitive nationwide search, which was guided by expert counsel, the RSP Advisory Board selected Northwest Plan Services (NWPS) as our Third Party Administrator (TPA) with Charles Schwab serving as the custodian of RSP’s assets.

NWPS is the largest Multiple Employer TPA in the country with a wealth of experience and tenure among its ownership and employees, and it offers a diverse range of qualified and nonqualified plans with highly competitive fees and expenses. In fact, the availability of nonqualified plans is what makes our new relationship with NWPS so exciting for current and potential RSP employers.

Recall that qualified plans, such as 401(k) plans, have tax-deferred contributions from the employee, and the amount contributed by employers may be deducted. Additionally, all employees who meet the eligibility requirements of qualified plans must be allowed to participate with proportionately equal benefits for all plan participants.

Conversely, nonqualified plans are funded with after-tax dollars and do not carry with them the same participation requirements. While employers generally cannot write off their contributions, nonqualified plans offer greater flexibility and can be tailored to meet the specific needs of both the employer and employees.

Furthermore, these nonqualified plans offer an attractive alternative for California employers who must comply with the new CalSavers mandate, a retirement savings program for employees who do not have access to a workplace retirement plan. Currently, all employers with more than 100 employees must participate in CalSavers. The deadlines for employers with more than 50 employees and greater than five employees are June 30, 2021, and June 30, 2022, respectively.

One final point of consideration for our selection of NWPS, we were impressed by their recommendation to change the RSP structure from a Group Trust to a Multiple Employer Plan or Pooled Employer Plan, which will streamline the auditing and reporting processes, significantly lowering compliance costs for RSP employers and participants.

As the custodian partner of NWPS, Charles Schwab is the largest custodian in the retirement industry with cutting-edge technology, unparalleled investment options, and favorable fees and expenses. Charles Schwab has also committed substantial sales and marketing dollars to help grow RSP.

Taken together, NWPS and Charles Schwab will allow us to become better stewards of our 401(k) resources, and to expand flexibility in plan design and investment options for RSP employers and participants.

In our relentless pursuit of excellence, we are excited about this opportunity to better serve the retirement needs of our members and are confident that our plan participants will yield immediate benefits on their path toward retirement security.

WG Staff Contact

Matt Lewis
President, WGFS
949-885-2379

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