Six Best Practices for Managing Retirement Plans During a Merger or Acquisition

It’s never too early to evaluate how a transaction could affect retirement plans. Starting early creates time to compare options and build a cleaner execution plan—while helping avoid rushed decisions that can lead to unintended tax consequences, eligibility issues, or unresolved operational, fiduciary, or documentation problems.

M&A can introduce fiduciary, operational, and investment complexity. Leverage your Financial Advisor relationship for help coordinating across internal stakeholders and third parties to strengthen governance, reduce transition risk, and support the planning and oversight of timely participant communications.

Instead of a piecemeal approach, set a clear plan strategy aligned to business goals (e.g., retention, simplification, cost savings) and build a cross-functional transition team (benefits, HR, payroll, legal, finance, communications, and key vendors) with defined responsibilities.

Recordkeepers can be critical partners in planning and execution, helping assess timing, workload realities (including busy periods), service models, and potential obstacles like non-transferable investments or liquidity constraints.

A smooth integration requires reconciling plan features (like auto-enrollment, match formulas, and vesting), coordinating investment mapping and transitions, and aligning payroll/HR systems with eligibility and contribution rules, especially if demographics or investment features (e.g., company stock, brokerage windows, illiquid funds) introduce added complexity.

Because M&A can be stressful for employees, proactive communication is essential. Communicate early to your employees and use multiple formats (emails, webinars, FAQs, and more) so participants understand what’s changing and what it means for their retirement benefits.