HUGE monthly fee at Ohio Public Retirement Systems?

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vu8
Posts: 56
Joined: Tue May 29, 2018 10:15 am
Location: Columbus, Ohio

HUGE monthly fee at Ohio Public Retirement Systems?

Post by vu8 » Sun Jun 03, 2018 5:31 pm

Hi there, I contribute to the Ohio PERS traditional 401k, defined contribution account every month. Yet they charge a Monthly fee of 5 dollars a month, on top of the Index Fund's expense ratio.
I earn very little money part time every month, contribute 15-20 dollars every month and 25% is eaten away by the 5 dollar monthly fee! The employer contribution won't vest 20% until I work for them for a year. And apparently I wouldn't be able to quit the plan until my employment has ended.
I have 300 dollars in my personal account, 200 in my unvested account and the monthly fee is deducted directly from my personal account every month.

What should I do? Take it out immediately after my employment ends? Put more of my personal money into it to reduce the expense ratio? Or I can just put my money into VTI.

MPAndy222
Posts: 42
Joined: Thu Mar 31, 2016 6:26 pm

Re: HUGE monthly fee at Ohio Public Retirement Systems?

Post by MPAndy222 » Sun Jun 03, 2018 6:59 pm

Are you eligible for STRS? They may have lower cost. Also when you reach $5000 you could switch to self-directed brokerage account with Charles Schwab which may have lower expenses. The $60 per year administration fee is not unreasonable - I know that it sounds outrageous when you only have a few hundred bucks but when you have a few $100k it won't be a big deal. The match alone is worth it - as long as you plan on staying at that position.

Nate79
Posts: 3574
Joined: Thu Aug 11, 2016 6:24 pm
Location: Delaware

Re: HUGE monthly fee at Ohio Public Retirement Systems?

Post by Nate79 » Sun Jun 03, 2018 11:29 pm

Do you get a match? If not why not just use an IRA with someone like Schwab where there are no fees?

student
Posts: 2574
Joined: Fri Apr 03, 2015 6:58 am

Re: HUGE monthly fee at Ohio Public Retirement Systems?

Post by student » Mon Jun 04, 2018 6:21 am

Nate79 wrote:
Sun Jun 03, 2018 11:29 pm
Do you get a match? If not why not just use an IRA with someone like Schwab where there are no fees?
I agree. You can buy its index fund with no minimum.
Last edited by student on Mon Jun 04, 2018 7:04 am, edited 1 time in total.

Determined
Posts: 266
Joined: Sat Aug 12, 2017 7:43 pm

Re: HUGE monthly fee at Ohio Public Retirement Systems?

Post by Determined » Mon Jun 04, 2018 6:58 am

vu8 wrote:
Sun Jun 03, 2018 5:31 pm
Hi there, I contribute to the Ohio PERS traditional 401k, defined contribution account every month. Yet they charge a Monthly fee of 5 dollars a month, on top of the Index Fund's expense ratio.
I earn very little money part time every month, contribute 15-20 dollars every month and 25% is eaten away by the 5 dollar monthly fee! The employer contribution won't vest 20% until I work for them for a year. And apparently I wouldn't be able to quit the plan until my employment has ended.
I have 300 dollars in my personal account, 200 in my unvested account and the monthly fee is deducted directly from my personal account every month.

What should I do? Take it out immediately after my employment ends? Put more of my personal money into it to reduce the expense ratio? Or I can just put my money into VTI.
Opers requires a 10% or 12% employee contribution and a 14% employer contributions. in the traditional defined benefit plan. Ther options are traditional defined benefita, defined contribution, and a hybrid. Once you elect your plan you cannot change it. You also cannot add more than 10/12%. If you are looking fir another tax deferred account, see if you are eligible for Ohio Deferred Compensation 457b.

OPERS and STRS work together for retiremet if you have years in both systems, but you can't opt into STRS without a job covered by them.

The flat fee undoubtedly is weighted unfairly towards you, but I don't see that you have an option. Look at it as your employer is covering it.

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