When hiring a Third-Party Administrator (TPA) to manage retirement plans, financial advisors must understand their client’s unique needs to select the proper administrator. There are many credentials held by retirement plan professionals, but not all benefit industry credentials are created equal. Without an understanding of the client’s needs, advisors will not know which of the many industry certifications properly equips the administrator with the knowledge and abilities necessary to service the client’s retirement plans.
One of these certifications is the QKA credential. Let's talk about this certification and what tasks it ensures administrators have the knowledge to perform.
The first thing to know about the QKA is that it is an abbreviation for Qualified 401(k) Administrator. This credential acquired through the American Society of Pension Professionals & Actuaries (ASPPA) is designed to teach current 401(k) best practices and the technical skills needed to properly service 401(k) plans.
The QKA credential is intended for anyone in the retirement plan industry who specifically works on 401(k) plans. Typically, a person who earns the QKA credential works at a TPA, recordkeeper, or consulting group. While they go by many titles such as ERISA Consultant, administrator client service manager, relationship manager, account manager, compliance specialist, plan administrator, or team leader, what remains consistent is that their role is to interact daily with the technical aspects of 401(k) plans.
How does a person go about earning the QKA credential? The first step is to apply for the course: potential candidates must read the ASPPA's Continuing Education (CE) Policy and apply for membership. They are also required to have either completed the Retirement Plan Fundamentals (RPF) certificate course or have their manager verify via signature that the applicant has at a minimum three years of experience in the field.
Once accepted, candidates must complete the ASPPA's new course (launched in January 2020), which features two sections—Plan Management and Testing. Each section is comprised of nine courses, a practice test, and a final exam. Candidates must earn passing scores on both exams.
Perhaps unfortunately for candidates, though, they still have work to do. In accordance with the ASPPA's requisite, all members are required to obtain 40 hours of continuing education credits—of which two must be Ethics—every two years to maintain their designation and ensure they are staying current with changes in the regulations and laws
A person who passes the ASPPA's course and has met the requisites will have demonstrated advanced knowledge of best practices of 401(k) administration. If a Retirement Plan Administrator holds the QKA credential, you can be assured that they have expertise in recordkeeping, nondiscrimination testing, administering 401(k) plans, and related defined contribution plans.
Comments