What is the primary purpose of providing the SPD to participants?

The primary purpose of providing the Summary Plan Description (SPD) to participants is to inform them about the plan provisions and their rights. The SPD serves as a crucial communication tool designed to give participants important information regarding their 401(k) plan, such as how the plan works, eligibility requirements, contribution limits, benefit entitlements, and procedures for claiming benefits. By clearly outlining the specifics of the plan, the SPD helps participants understand their benefits, options, and responsibilities, thereby enhancing their awareness and engagement with their retirement savings.

While other options, such as communicating investment performance, disclosing administrative fees, or outlining the role of the plan administrator, are important aspects of plan management, they are not the primary purpose of the SPD. The core function of the SPD is to summarize the essential provisions of the retirement plan and to clarify the rights of the participants associated with those provisions.