401K/Profit Sharing without limitations?

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KMB
Posts: 13
Joined: Fri Aug 28, 2015 6:52 am
Location: Chicago-ish, IL

401K/Profit Sharing without limitations?

Post by KMB » Wed Dec 05, 2018 11:22 pm

I am a physician in a medical practice and we have a profit sharing/401K plan. Up until now, I have used a financial guy to manage my 401K at Schwab (which is in a variety of stocks with frequent churning), for AUM fee. I am finally considering moving to index funds and when I asked an administrator at my practice, was told I can “transfer it wherever you want-Fidelity, Vanguard, and invest in whatever you want.”

My preference is to move it to Vanguard index funds per my asset allocation. Is it possible I could do whatever I want with my 401k within my plan? I was under impression from other forum threads that plans tend to have limited offerings...?

Thank you in advance

KMB

jacoavlu
Posts: 628
Joined: Sun Jan 06, 2013 12:06 pm

Re: 401K/Profit Sharing without limitations?

Post by jacoavlu » Thu Dec 06, 2018 1:27 am

It sounds like you have self directed brokerage accounts for your plan. From what the administrator said. You should confirm that.

If this is the case, you can move to Vanguard, but with a caveat. Vanguard will only do a pooled account in this situation. Which is fine for you if no one else in the plan is at Vanguard. But if someone else has an account there then it gets really tricky and likely isn’t worth the hassle.

Schwab and others will do “FBO” accounts for such cases. But Vanguard will not.

I will add. Schwab has its own excellent fund offerings. I think their target retirement index funds are excellent.

KMB
Posts: 13
Joined: Fri Aug 28, 2015 6:52 am
Location: Chicago-ish, IL

Re: 401K/Profit Sharing without limitations?

Post by KMB » Thu Dec 06, 2018 5:13 pm

jacoavlu, thank you for the information.

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