Plan Sponsor – The company that establishes and sponsors the retirement plan

Retirement Committee – Select employees of the company responsible for making decisions on behalf of the Plan Sponsor. Usually established with a corporate resolution. They are responsible for hiring service providers and are fiduciaries to the plan.

Plan Administrator – An employee of the Plan Sponsor responsible for the day-to-day administrative tasks of running the retirement plan. They interface with service providers and handle items such as payroll, distributions, and loans.

Participant – Employees of the company who save money for retirement.

Custodian – Responsible for safeguarding the retirement plan assets.  Often participant level trades are rolled up at the plan level and traded with each mutual fund offered in the menu.  Custodians hold assets for many other retirement plan clients.

Retirement Plan – The combination of all services required to operate the plan. Furthermore, there is a legal document that describes “Retirement Plan” elements such as entry, eligibility, matching formulas, distributions, and loans. This is the Plan Document. A Summary Plan Description (SPD) describes these elements in plain English.  

Investment Adviser – The retirement committee may contract with an investment adviser.  The investment adviser may act as a fiduciary or non-fiduciary. Services may include plan level services such as selecting and monitoring investments offered to participants. Participant level services may include providing education, guidance, advice, and/or investment management.

Recordkeeper – Responsible for tracking participant level transactions. They often provide website access for participants. Furthermore, they provide connectivity with the custodian, administrator, and 3rd Party Administrator by providing access to the record keeping website.

3rd Party Administrator – Provides the “Retirement Plan” with day-to-day participant level administrative transactions such as distributions, payroll, and loan processing. They also provide plan level functions such as compliance testing, IRS filings and plan design consulting. They often interface with the plan administrator and record keeper.

Mutual Fund Manager – The retirement plan will offer a menu of different mutual funds from which participants will select for their account. The mutual fund manager is responsible for determining which stocks and bonds to purchase for each mutual fund.

Customer Service Rep. – Responsible for taking participant calls and providing direction, such as assisting with website access or understanding how to complete a form.

Bundled Service Provider – A company that will bundle services under one common entity.  A typical combination is one in which the “Bundle Provider” provides custody, record keeping, 3rd party administration, customer service, and investment advisory services.  Sometimes this bundled provider will also manage and offer mutual funds to the retirement plan.