The Frugal Fiduciary Small Business 401(k) Blog

Get the latest industry news, deadlines and tips you need to know to help tackle your fiduciary responsibility needs.

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401(k) Fees | Retirement Planning | Provider Shopping

Want to Retire Early? Three 401(k) Features That Can Help

By: Eric Droblyen
February 17th, 2021

To plan for retirement, 401(k) participants should set a savings goal and develop a strategy for reaching that goal. To reach their goal at the lowest out-of-pocket cost, I recommend participants follow a simple 4-step strategy – start early, contribute regularly, invest appropriately, and lower fees. However, to reach their goal as soon as possible, participants will need some help from their 401(k) plan. Here are the three 401(k) plan features that can help any saver – including you – retire years sooner.

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401(k) Fees | Plan Design | Fiduciary Responsibility

401(k) Plan Restatements - Save Fees With These Amendments

By: Eric Droblyen
February 3rd, 2021

401(k) plans must operate according to the terms of a written plan document to meet IRS qualification requirements. Most plans use an IRS preapproved document for this purpose. These documents must be fully rewritten (or restated) every six years to reflect recent law changes. The last 6-year restatement cycle was called “PPA” after the Pension Protection Act of 2006. A new cycle - called "Cycle 3" - opened last year. From August 1, 2020 to July 31, 2022, all pre-approved 401(k) plans must be restated onto a Cycle 3 document.

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401(k) Plan Design Checklist

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Subscribe to the The Frugal Financial Small Business 401(k) Blog and receive this free checklist for help in determing the best 401(k) plan design options and fit for your company.

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Investments | 401(k) Fees | Fiduciary Responsibility

'Hidden' 401(k) Fees – What Business Owners Need to Know

By: Eric Droblyen
January 6th, 2021

401(k) providers can charge “direct” and/or “indirect” fees for delivering plan administration services such as asset custody, participant recordkeeping, Third-Party Administration (TPA), and professional investment advice. The difference between the fees is how they are paid. Direct fees can be paid by the plan sponsor or deducted from participant accounts, while indirect fees increase the cost of plan investments – reducing their returns. If you’re a business owner, I strongly recommend you avoid indirect fees for two reasons – 1) they lack the transparency of direct fees – which makes excessive 401(k) fees harder to avoid and 2) they could limit your access to top 401(k) investments - which often pay no indirect fees.

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401(k) Fees | Provider Shopping | Fiduciary Responsibility

How to Find & Calculate Transamerica 401(k) Fees

By: Eric Droblyen
December 17th, 2020

If you have questions about Transamerica 401(k) fees – how they work, how much they cost on average, or how you can find & calculate them for your plan – you’ve come to the right place. In this guide, we’ll show you how to calculate the full cost of a Transamerica 401(k) plan using their DOL-mandated fee disclosure.

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401(k) Fees | Provider Shopping | Plan Setup

Small Business 401(k) Tax Credits – Including SECURE Act Enhancements

By: Eric Droblyen
September 16th, 2020

On December 20, 2019, the Setting Every Community Up for Retirement Enhancement (SECURE) Act was signed into law. The legislation made many significant retirement plan changes, including enhanced tax credits for small businesses that start a new 401(k) plan and/or add an automatic enrollment feature to any 401(k) plan. For most small businesses, these changes took effect January 1, 2020. 

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401(k) Fees | Retirement Planning | Provider Shopping

Paying 401(k) Admin Fees from Plan Assets Hurt Business Owners Most

By: Eric Droblyen
August 19th, 2020

When a 401(k) provider’s administration fees are paid from plan assets, they're typically allocated among plan participants pro rata based on account balance. That means the plan participants with largest account balances pay the highest fees. In most small business 401(k) plans, that group usually includes the business owner.

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