PLAN SPONSOR Meaning and
Definition
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A plan sponsor refers to an entity that establishes, manages, and provides a retirement plan for the benefit of its employees. This term is commonly used in the context of employer-sponsored retirement plans, such as 401(k), pension, or profit-sharing plans. The plan sponsor can be an individual employer, a group of employers forming a consortium, or an organization such as a union or professional association.
As the plan sponsor, this entity assumes the fiduciary responsibility for the retirement plan and is entrusted to act in the best interests of plan participants, who are the employees contributing to the plan. The primary role of a plan sponsor includes designing the retirement plan, selecting investment options, administering the plan, and ensuring compliance with relevant legal and regulatory requirements.
The plan sponsor typically has the authority to make decisions regarding plan provisions, contribution amounts, eligibility requirements, and vesting rules. They also have the responsibility to engage service providers such as investment firms, record-keepers, and third-party administrators to assist in the efficient management of the plan.
Additionally, the plan sponsor is responsible for educating employees about the retirement plan and providing them with necessary information, such as investment choices, contribution options, and distribution rules. They also have a duty to monitor the plan's performance and periodically review its design and operations to ensure it remains in line with the changing needs and regulations.
Common Misspellings for PLAN SPONSOR
- olan sponsor
- llan sponsor
- -lan sponsor
- 0lan sponsor
- pkan sponsor
- ppan sponsor
- poan sponsor
- plzn sponsor
- plsn sponsor
- plwn sponsor
- plqn sponsor
- plab sponsor
- plam sponsor
- plaj sponsor
- plah sponsor
- plan aponsor
- plan zponsor
- plan xponsor
- plan dponsor
- plan eponsor
Etymology of PLAN SPONSOR
The term "plan sponsor" does not have a specific etymology as it is a combination of two words: "plan" and "sponsor".
The word "plan" originated in Middle English from the Old French word "plan" meaning "ground, flat surface". Over time, its meaning evolved to refer to a scheme, method, or course of action.
The word "sponsor" originated from the Latin word "spondēre", meaning "to promise" or "to pledge". In ancient Rome, a sponsor was an individual who vouched for another person in legal or financial matters.
In the context of retirement plans and employee benefits, the term "plan sponsor" refers to the organization or entity that establishes and maintains a retirement plan for its employees. The plan sponsor is responsible for funding the plan and selecting the investment options available to the participants.
Similar spelling word for PLAN SPONSOR
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