Choosing a 401k provider

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absauston
Posts: 9
Joined: Tue Aug 27, 2013 7:34 pm

Choosing a 401k provider

Post by absauston » Sun Dec 03, 2017 11:11 am

Hello All,

I have been looking into my company's 401k plans/fees. There are some high fee funds that our local bank put together as well as a 0.6% fee added the regular fund fees for administrative paperwork and most importantly to put the fiduciary responsibility upon the bank. However, I believe there wasn't any shopping done by my controller.

I have put in a call to Vanguard to see if it would be prudent to switch entirely to them. I want to look out for my employees as well as balancing the company's interest. I would like the fiduciary reasonability to be upon the plan provider rather than hold the company liable. I frankly don't know how fickle the laws are with company carrying the fiduciary responsibility for a plan. If it is something minor or a simple purchase of insurance/bonds and some paperwork to keep current with the laws I would be more apt to carry the responsibility.

If any other employers out there can help me navigate this I would greatly appreciate this and I am sure my employees would too!

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Wildebeest
Posts: 1016
Joined: Fri Dec 27, 2013 2:36 pm

Re: Choosing a 401k provider

Post by Wildebeest » Sun Dec 03, 2017 11:30 am

The Wiki is a great resource:

https://www.bogleheads.org/wiki/Setting ... 01(k)_plan

We interviewed different pension plan consultants.

We went with the one our CPA suggested and have been happy.
The Golden Rule: One should treat others as one would like others to treat oneself.

sport
Posts: 6136
Joined: Tue Feb 27, 2007 3:26 pm
Location: Cleveland, OH

Re: Choosing a 401k provider

Post by sport » Sun Dec 03, 2017 2:40 pm

When my division split from a larger company, we had to set up our own 401k plan. I was on the committee that helped to select the provider. The first consideration is how large is your plan (how much money is in the plan)? We had a small plan and that greatly limited our options. larger plans can get better providers.

absauston
Posts: 9
Joined: Tue Aug 27, 2013 7:34 pm

Re: Choosing a 401k provider

Post by absauston » Sun Dec 03, 2017 6:40 pm

It's a very small plan it just got started this year. I would say <$30,000 right now.

sport
Posts: 6136
Joined: Tue Feb 27, 2007 3:26 pm
Location: Cleveland, OH

Re: Choosing a 401k provider

Post by sport » Sun Dec 03, 2017 10:28 pm

My experience was about 20 years ago. We had about 1 million in the plan. This was considered to be a small plan by the providers. The best we could do then was an insurance company. It was not a good plan. When the plan reached 3 million, and the CEO became unhappy with the plan, we were able to get a better plan with another insurance company. It was still expensive, but about half the cost (to the participants) of the previous plan. There may have been better options available. However, the company management insisted on using the broker we had for health insurance. I do not know what kind of influence this broker may have had with the company owner or management.

niceguy7376
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Joined: Wed Jul 10, 2013 2:59 pm
Location: Metro ATL

Re: Choosing a 401k provider

Post by niceguy7376 » Sun Dec 03, 2017 11:11 pm

https://www.guideline.com/ is one of the lowest 401k that I have seen in recent years.

absauston
Posts: 9
Joined: Tue Aug 27, 2013 7:34 pm

Re: Choosing a 401k provider

Post by absauston » Mon Dec 04, 2017 8:55 pm

Thanks for the responses. I will absolutely check into that link! Thanks!

KSActuary
Posts: 180
Joined: Fri Jan 13, 2012 10:53 pm

Re: Choosing a 401k provider

Post by KSActuary » Mon Dec 04, 2017 10:02 pm

I would like to hear from anyone who works with Guideline and learn more about their custom portfolios and pricing. I find it difficult that $96/year covers the services that they offer.

NWbrewer
Posts: 20
Joined: Tue Dec 01, 2015 10:37 am

Re: Choosing a 401k provider

Post by NWbrewer » Wed Dec 06, 2017 12:52 am

Employee Fiduciary is one that comes up pretty regularly here. They specialize in small company plans and offer fidelity, vanguard, and many other Co. funds.

Spirit Rider
Posts: 6612
Joined: Fri Mar 02, 2007 2:39 pm

Re: Choosing a 401k provider

Post by Spirit Rider » Wed Dec 06, 2017 1:34 am

Guideline's $96/year is per employee (min 5). There are plans < this per employee when you get to dozens of employees. They have received venture capital funding so maybe their low minimum plans are a loss leader to build a market. I have seen favorable reports a few months in. I haven't seen anything for periods of a year or more.

However, I am a little concerned that the reports I have seen have a shill like feeling. That is, new members of this and other forums whose early posts are to boost Guideline and then few if any later posts.

Now, these can sometimes be people legitimately using the services, but I would much rather see longer term members and a critical mass of happy customers like Employee Fiduciary and some of the other low cost bundled providers have before being comfortable with Guideline.

JimmyJammy
Posts: 120
Joined: Sat Oct 26, 2013 1:08 pm

Re: Choosing a 401k provider

Post by JimmyJammy » Wed Dec 06, 2017 1:29 pm

I've had a great experience at TD Ameritrade. I love the number of options available. I recently moved there from T Rowe Price (which is also very good) in order to have access to cheaper bond funds.

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