Private practice business: boglehead setup for retirement accts?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
shawn_lad
Posts: 26
Joined: Tue Mar 20, 2018 4:01 pm

Private practice business: boglehead setup for retirement accts?

Post by shawn_lad » Wed Mar 21, 2018 12:18 pm

Hi there!

I am a long time reader / first time poster. I've learned a lot from this forum for personal finances and investments. Thank you! My question is for a friend of mine, who is a partner in a small medical private practice (LLC I believe), and they are looking to revamp their setup for retirement options.

Currently they contribute the max
- 18k + percentage of profits to get close to the ~55k limit for 401k
- have a "cash balance" plan

All this seems to be handled by layers of high-fee firms.

What do you recommend for an alternate boglehead setup with low costs?

shawn_lad
Posts: 26
Joined: Tue Mar 20, 2018 4:01 pm

Re: Private practice business: boglehead setup for retirement accts?

Post by shawn_lad » Thu Mar 22, 2018 4:50 pm

Found out some current details on 401k/profit sharing plan.

TransAmerica administers it / Stiefel Nicholas is the financial advisor / Another company for TPA

Plan assets size: ~9M; # participants 9

Yearly fees from the brochure:

TPA fees ~$5k
Financial Advisor fees: 0.3%
Contract fees (Contract Asset Charge) is listed as 0%.
Recordkeeping fees $0

Offered funds range in 0.8% to 1.75%, including Vanguard Target funds at 0.9% !

Any other fees I should be asking for?

I hope to get some info on cash balance plan later.

User avatar
Ever Ready
Posts: 295
Joined: Sat Feb 24, 2007 3:21 pm
Location: DC metro

Re: Private practice business: boglehead setup for retirement accts?

Post by Ever Ready » Thu Mar 22, 2018 7:59 pm

I don't know much about this topic, but there is a relevant website run by a Bogle head author:

https://www.whitecoatinvestor.com/how-t ... ment-plan/

Spirit Rider
Posts: 8870
Joined: Fri Mar 02, 2007 2:39 pm

Re: Private practice business: boglehead setup for retirement accts?

Post by Spirit Rider » Thu Mar 22, 2018 8:46 pm

You friend's practice could definitely do better.

With that level of assets, I would contact Acensus. They administer Vanguard's small business plan. My guess is that their administrative costs will be in the ballpark of what they are paying now. They should be able to get index funds averaging ~= 0.10% and active funds if they want ~= 0.50%.

Post Reply