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IRA Distribution Strategies Expert


Accredited Investment Fiduciary - AIF®

Major changes to 403(b) plans must be implemented by January 1, 2009

New 403(b) rules require employers to become more involved in the oversight of their 403(b) plans. Under the new rules it will be difficult to maintain the type of plan most are used to; a plan where every participant just chooses their own provider.

The new rules require better oversight of these accounts and obligate each provider to communicate with the others to help insure that all accounts are in compliance with IRS regulations. This new communication requirement makes the use of several providers impractical yet limiting the number of providers could limit the investment choices participants have.

With all of these new rules employers will likely start to ask themselves why they would want to get involved with multiple providers.

Do I really want to track contributions, transfers, distributions and loans from three or four different sources?

Do I really want to have to compile plan level asset statements from multiple sources to complete the plan 5500 tax filing?

If I can get true investment diversity and address all of the needs of the plan from a single source doesn’t it make a lot more sense to do that?

We offer a solution that addresses all of the new requirements while offering the following:

  • Compliance with plan document requirements
  • Choice of hundreds of investment options
  • Low costs to both the plan and plan participants

Back in the early days of cars Henry Ford said “you can have any color of car you want… as long as it’s black. And the majority of packaged or turn-key 401(k)/403(b) products out there are just about as flexible as Ford was. These packages are designed to support a high-volume, standardized model with very little flexibility. They are designed as much to suit the needs of the provider as they are to suit your needs.

We know - we are able to offer 403(b) programs from most of the major mutual fund and insurance companies, we have found most of them to be about twice as expensive as our program and most either limit investment to proprietary funds or charge assets based fees (in addition to underlying fund costs) of .70% or more for “out-side” funds.

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