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  • Switch 401k provider

    Hello everybody
    I am looking at some opinions here. I have a Safe Harbor 401k plan with Vanguard/Ascensus. We are a small business , 3 employees on the plan.
    I am looking at increase in expenses in administration fees from Ascensus. This year the fees were almost $4,000/year, plus an extra $500 for profit sharing calculation. It is a substantial amount for our business size financials.
    I would like to know if there are other providers out there who are using Vanguard funds , but lower overall administration fees.
    So far I spoke with America Best 401k , dealing with medical/dental professionals. Their administration fees total half what Ascensus charges, with Vanguard funds, expense ratio similar.
    Any advice regarding if is a good idea to switch?
    or other alternatives?

    Thank you

  • #2
    We use fidelity and have been happy, although we are much bigger. They also do our payroll.

    were you really a mime before becoming a dentist?

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    • #3
      Thank you for response. Mime is a short abreviation of my first/last name

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      • #4
        If you are referring to New Comparability method profit sharing, I am aware of two low cost no frills TPAs. I have no direct experience with either of these.

        ​​​​​​Employee Fiduciary has anecdotally received good reviews. Their annual administrative fee is $1500 for up to 30 employees. They also have a 0.08% AUM fee.

        Guideline has received mostly positive reviews, with others having problems with lack of support. Their Prime safe harbor 401k plan is ($99 + $8/participant)/month.

        They will both have setup/conversion fees. They both support New Comparability method profit sharing, but I do not know the annual cost. Keep in mind that nothing is free. Support is expensive. Lower cost TPA plans of necessity are going to be no frills.

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        • #5
          Guideline may work well for you. They seemed competent when I spoke with them and we nearly switched to them with their New Comparability offering but ended up going with Vanguard / Ascensus and an independent TPA.

          it’s not going to get a whole lot cheaper than $4500, and it’s quite a lot of work to move a plan

          you could easily lose way more than the amount you’re saving in fees, simply by market fluctuation during the time of asset transfer between custodians. Especially if your plan balance is substantial.

          when we moved our plan I demanded that all participant assets be moved in kind. It was more work and hassle but there was a significant run up in the market during our blackout period so it was well worth the effort

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          • #6
            My dental office has been looking at making a 401K change as well and we looked into both Guideline and Employee Fiduciary as options (as they are both extremely low-fee, especially compared with what we currently have). We have not decided where to go yet but does anyone have any personal experience with either of those 2? They do get great reviews generally but have heard that dental practices' 401Ks can be more complicated.

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            • #7
              I was paying a little over 2% per year in fees to principal. 2 years ago I switched to 'creative planning'. Now my clinic portfolio is in 7 figures and I am glad I pay under 0.8% overall. I also pay maintenance fees from clinic account so there is no significant reduction in the portfolio and I can deduct it as a office expense. They are easy to work with and are improving even more. The funds are vastly vanguard and now fidelity low low cost. Try them. I cant expect a much lower cost.

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