If it ain’t broken, don’t fix it and other complacent Plan Sponsor excuses

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One of the most annoying phrases out there is: “if it ain’t broken, don’t fix it”. I have disliked it for more than 20 years after seeing a student government political candidates use it back at Stony Brook.

Through out my career whether it was at school or at work, I would always here that phrase as well as “well, it’s always been that way”. Sometimes, what had always been that way has always been wrong too.

Civilizations progresses because people progress and people could only progress if they change. We wouldn’t have IPads if Steven Jobs thought that IPhones were good enough, we’d still be carrying around cell phones in a briefcase or plugged into our car paying obnoxious per minute charges if it wasn’t broken or if it was always that way.

Plan sponsors can’t afford to be complacent and they can’t afford to just write off any potential change to their plans because it isn’t broken. Complacency is just another form of laziness and when you are a plan fiduciary, you can’t just sit back and let time pass by. Saying that you’ve had the same plan provider for 20 years doesn’t mean they shouldn’t be replaced especially when you discover that they haven’t done the most competent job or are charging excess fees.

I had a client being sued by the Department of Labor because she used a TPA for 28 years without realizing they didn’t do valuations or distribution forms for owner-employees.

Plan sponsors have too much fiduciary liability to be complacent. Instead of being convinced that things aren’t broken, plan sponsors need to make sure that their plans have advisors that are at the top of their game and willing to be ahead of the curve because those that don’t change with the times will have the times change them.

If it ain’t broken, don’t fix it is a cop out. It means we are too lazy to be better.  For those who are plan sponsors, complacency can be a killer.