Things Many Business Owners and Leaders Don’t Know About 401(k) Plans

Eric Mikkelson |

Please know that our firm, RMR Advisors, is not selling a service nor are we paid in any manner to share this information. We simply feel compelled to share what we have learned while working in the industry and servicing our clients’ businesses. Our goal is to provide information that hopefully helps businesses meet legal and fiduciary obligations to their employees, while being more efficient, with dramatically less costs; benefitting both businesses and employees.

Things Many Business Owners and Leaders Don’t Know About 401(k) Plans
1. Legal obligations: As a fiduciary to your company’s plan (and therefore, your employees), you can potentially be sued for breach of fiduciary interest if your plan allows for unreasonably high fees, inappropriate fund choices or conflicts of interest.
2. Cost: Often there are multiple layers of fees within plans and the available investment options. The impact on your employees’ retirement savings can be dramatic.
3. Complexity: Most plans are overly complicated when they don’t need to be, taking up too much of your time that could be better spent on building your business
4. Recently, many of the biggest 401(k) plan providers have been named in lawsuits for excessive fees and self-dealing, including Voya, UBS, and Transamerica.

Through our recent search for better 401k options that address the four areas of concern listed above, we have found America’s Best 401k (AB401k) to be an excellent resource. They are at the frontier of the movement to lower retirement plan costs while providing complete transparency. We learned about them from Tony Robbin’s latest book, Unshakeable. In that book, Tony recounts his personal experience learning about all of the hidden fees (and therefore drain on performance) in his own firm’s 401(k). He introduces the reader to the CEO of AB401k, Tom Zgainer, who explains that he started his company to provide a lower cost and more efficient option for businesses with complete fee transparency. We reached out to Mr. Zgainer ourselves and after doing extensive due diligence feel compelled to spread the word. Tom has agreed to personally address the questions of business leaders we introduce to AB 401k, and thus, we would be happy to set up a call with him if you are interested.

Things we like about Tom and his firm:
• Legal protection for the business owner by fulfilling your fiduciary legal duty to your employees under ERISA
• No brokers or middlemen, meaning no commissions on employee investments
• Low cost index fund options for all plans regardless of size instead of higher cost actively managed funds
• No contract asset charges, mark-ups or other hidden layers of fees, with one transparent fee schedule
• A fully bundled solution (administration, record keeping, personal advice, etc.)
• Modern, mobile, on-demand access for both the plan sponsors and participants, adding more transparency
• Types of plans offered: 401k, 403b, Defined Benefit, Profit Sharing and Cash Balance
• No conversion fees for transferring a plan to AB401k. No setup fees for new plans. Little of your time needed.

We want to reiterate that RMR Advisors is not affiliated with and does not, nor ever will, get paid for referring plans to AB401k. We simply think they provide a much-needed public service and would like to spread the word to businesses and employees in our communities who can benefit from this service.

Through Tom’s team, a comparison of your current plan with AB401k can be arranged at no cost, and with no obligation. This can help you determine whether a change may be appropriate for your business. If you are interested in learning more, including receiving a free side-by-side plan comparison, please contact us at 608-663-7676 or at dkgiageos@rmradvisors.com.