Many articles talking about good retirement plan practices will talk about the need for employers to set up retirement plan committees to manage their 401(k) plan.

While I agree that there needs to be some sort of process in place to run the plan, there are many instances when committee are a hindrance when they become a bureaucracy. I once joked that as an associate attorney at a semi-prestigious that if the managing attorney wanted to kill an idea, she’d create a committee for it. Recently, someone at synagogue told me that they created a committee to improve the members’ experience and there are 37 people on the committee.

A committee to handle a 401(k) plan has to be put in place to actually run the plan, it can’t be created as another roadblock in getting the plan run in a prudent manner. If it becomes a bureaucracy and is paralyzed from acting in the best interests of plan participants, then the committees become part of the problem and not the solution.