changing Plan Trustees

[Lori H]

A financial institution is currently the trustee of a small 401(k) plan. They are charging ridiculous admin/trustee fees to the plan administrator. What process should the plan admin take to remove them as trustee? A letter and board resolution?

[WDIK]

It is likely that the plan document has language similar to the following:

"The Sponsoring Employer may remove a Trustee by giving such Trustee 30 days written notice in advance."

A board resolution and a letter of notification seems likes a reasonable course of action to me.

(Please note that there is a distinction between a sponsoring employer and a plan administrator.)

[JanetM]

Actual language from one of our plans.

All contributions to the Trust Fund shall be paid over to the bank or other person or persons selected by the Plan Sponsor as Trustee under this Plan (or to such successor trustee with whom or which the Plan Sponsor may enter into a Trust Agreement to fund the benefits under this Plan), including a trustee of a master trust. The Plan Sponsor may remove any trustee at any time, upon reasonable notice, and upon such removal, or upon the resignation of a trustee, the Plan Sponsor may designate and appoint a successor trustee; provided, however, that no such removal or designation and appointment of a successor trustee shall have the effect of or result in the use of any part of the Trust Fund for any purposes other than for the exclusive benefit of Participants or their beneficiaries or the payment of expenses under the Plan.

[Lori H]

Thanks guys n gals.

Have a great day.