Unseen fees can take an unacceptably high share of your investment return. American 403b has no undisclosed fees, no advisory fee, and no asset management fee. Mutual funds are offered as retirement share class funds, those unique to a 403b, with mutual fund expenses detailed by prospectus.
One-on-one employee enrollment is also included. In our experience, this is the one key area essential to a plan’s success. Unique to American 403b, we take the time to get know your employees with personalized enrollment and attention to their retirement savings needs.
Summary Of Fundamental Fees
There are two sets of expenses on a 403b including billable fees – the fees that the employer is billed for administration, and secondly, the fees experienced by participants on investments.
1. Administration Fees
- Annual Administration Fee: $500 + $20/participant/year
- Installation Fee: $250 one-time
- Custodian Fee: 1/10th of 1% annualized custodian fee experienced by employee within investment account
ABC Eductional Enterprises is establishing a new 403b.
They have 10 participants.
The annual employer administration fee would be $700.
Subtract the IRS tax credit of $350 which applies in years 1 through 3.
The net total annual employer administration fee would be $350.
Note: The IRS offers a small business tax credit for 401k, Single k, 403b, or SIMPLE startup costs. The credit equals 50% of the cost to set up a new plan, administer it, and educate employees about the plan, up to a maximum of $500 per year for each of the first three years of operation. Details of the tax credit: 401khelpcenter.
For your own custom 403b quote, just ask!
2. Investment Related Fees
- Mutual Fund Expenses: Expenses per prospectus are the only investment related fees within this program.
Mutual fund expenses are detailed by prospectus and one will be provided for each fund prior to investing. All shares as offered are retirement share classes. That is, as offered in a 403b and including American 403b, they have lower expense ratios than retail share classes.
- Asset Management Fee: 0%
An important feature with this program is that we do not charge an asset management fee.
- Advisory Fee: 0%
Another important feature with our program is that there is no advisory fee.
Daily Administration Fee Schedule
|INSTALLATION AND INITIAL QUALIFICATION FEES:|
|Document Fee (Includes Trust Document & Summary Plan Description)||$250|
|Take-over Fee for Existing plans (Set-up plan specifications and all employee data)|
Note: The Installation Fee is payable in advance at plan establishment.
|Annual Recordkeeping Fee (including Form 5500)||$500|
|Fee per Eligible Participant||$20|
|OTHER FEES (these fees are ancillary to annual fees noted above and apply only in specific situations)|
|IRS Determination Letter Submission Fee (applies only to individually designed plans submitted to IRS)||Not Applicable|
|ADP/ACP Test Corrections||Not Applicable|
|New Comparability Calculations (up to 4)||$0|
|Plan Amendment Fees (applies only to required IRA amendments when 403b rules change)||$125|
|Plan Termination/Transfer Fee (does not include final administrative fees)||$0|
|Overnight Fee (applies only when reports and/or statements are requested by overnight delivery)||$25|
|Audit Support, per hour (applies only to plans with 100+ eligible employees)||$75|
|Brokerage Window (fee is per account, annually)||$50|
|DEFAULT PARTICIPANT FEES|
|Annual Custodial Fee:||1/10th of 1% of participant account value, annualized|
|Minimum Custodial Fee for 403b with under $250,000 in Plan assets||$250 (total, not per participant)|
|*Note: The Annual Custodian Fee is assessed internally against plan assets - it is not a fee to the employer|
|PARTICIPANT DISTRIBUTION FEES|
|Participant Distributions (participant notification and election forms,process distributions and prepare Form 1099-R, 1096 and 945)||$50 per distribution|
|Loan Origination (preparation of loan documents)||$100|
|Loan Maintenance, per year, per participant||$50|
|Stop Payment/Returned Check Fee||$25|
|Fees billed to the employer or employee can be changed at the Trustee discretion
*Mid Atlantic Trust Company is the custodian of American 403b