A lot of the bundled third-party administration (TPA) firms are offering free distribution packages to participants who need a distribution because of Coronavirus. They can afford to because their TPA business has only been ancillary for the distribution of their mutual fund or insurance-based. Products. As an unbundled TPA, I suggest you don’t.
You need to be compensated for your time and no matter what people may think, it is a lot of work. Why waive a fee for people taking money on plans that will negatively impact your business? More importantly, it’s a lot of work and you need to be compensated for your time. My point is that when you give away free services, you are showing that your services essentially have no value. In this day and time when many of us are struggling, I don’t think it’s wise to offer free distributions.
