Financial Advisors

I have a 401(k) plan that I am being requested pricing on for a local medical group. It's about $2M with 57 participants. What would you guys take as far as compensation goes for a plan of this size?

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Realistically, within 10 years, thee's going to be consolidation within the 401K space, and most plans will (or should be) around 25 bips (or less) to the advisor, and using index funds at <20 Bips.Add in various TPA fees, etc. and they should still be at or below 100 Bips. Maybe that will be higher for small plans because TPA fees are going to have floors, but for moderate size and larger, there's no reason to be over 100 Bips, all-in.

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25 bps.

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What was the reason they wanted to change?

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As you know all plan providers have different fee's as do the funds in the plan . Typically here is what I see in the 401k space . Plans under 1m in assets -1 percentPlans between 1m-2m - .05 percentPlans over 2M- 0.25-3percentWith that being said I just became broker of record on a 6m dollar plan and the RIA firm managing it was charging 0.65 percent. This was a very vanilla 401k with around 120 employees.

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I'd target 35 bps but would go down to 25 if it was necessary to win the plan.

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