Streamlined Plan Delivers Success

Feb 15, 2017

After declines in participation rates, Newport Group and its advisor partner help a cabinet manufacturer build a better 401(k) Profit Sharing Plan.


After freezing its pension plans, a leading cabinet manufacturer found that participation rates in its 401(k) Profit Sharing Plan were on the decline. A survey of plan participants revealed that many started enrollment, but failed to follow through to completion. These employees said they were confused with the plan’s 30+ investment choices. Most plan participants were also not properly diversified. In addition, ADP testing was failing, resulting in refunds to highly-compensated employees. The client turned to Newport Group and its advisor partner to:
  • Improve participation
  • Increase deferrals
  • Pass testing
  • Improve investment diversification
  • Remove hurdles to enrollment


Newport Group and its advisor partner proposed the following:
  • Adding 4 percent auto enrollment to the plan design
  • Simplifying the investment menu with target date funds (with re-enrollment) and model portfolios
  • Adding a Safe Harbor matching formula of 100 percent on the first 4 percent
  • Streamlining the eligibility/enrollment process
  • Introducing an easy enrollment mailing campaign, with advisor-led meetings at all of the company’s locations.


The Newport Group solution delivered dramatic results. Plan participation rates more than doubled (from 34 percent in 2012 to 76 percent today), deferral rates increased, and 95 percent of participants are now properly diversified. The plan also has a free pass on ADP testing, thanks to the inclusion of the Safe Harbor design. Importantly, the company has positive feedback from participants on these new changes.

Fast Facts

  • Client: Manufacturer
  • Plan Type: 401(k) Profit Sharing
  • Plan Assets: $150 million
  • Plan Participants: 5,569
  • Client since 2001

How we helped the client

  • Reduced total plan costs by 45 percent
  • Reduced client burden by taking on the eligibility and enrollment process
  • New plan design changes took the focus off the frozen DB plans

How We Helped Our Advisor Partner

  • Provided easy enrollment cards and communication materials to assist with meetings to attain client goals
Download a copy

Unauthorized access is prohibited. This site is designed for U.S. residents only.
Newport Group, Inc. and its affiliates provide recordkeeping, plan administration, trust and custody, consulting, fiduciary consulting, insurance and brokerage services. Fiduciary consulting services are provided through Newport Group Securities, Inc., an SEC-registered investment adviser and FINRA-registered broker-dealer, and InterServ, LLC, an SEC-registered investment adviser. Newport Group Securities, Inc. and InterServ, LLC are affiliates of Newport Group, Inc. All securities transactions are provided through Newport Group Securities, Inc., in its role as broker-dealer. All fiduciary consulting services are provided through the registered investment adviser. when offering variable insurance products, Newport Group Securities, Inc. acts solely in its capacity as a broker-dealer.
Trust and custody services provided by Newport Trust Company, a New Hampshire state chartered trust company and wholly owned subsidiary of Newport Group, Inc.