How Does Your 401k Plan Compare?

Get a no-cost, no-obligation Summary Benchmark of your retirement plan to others of similar size and in your industry. We’ll order a Summary Diagnostic from Advisor Lab, a leader in retirement plan benchmarking, and e-mail the diagnostic to you with our initial analysis. [Sample Diagnostic]

All we ask is for the opportunity to see if switching your plan to us can benefit your company and your employees.

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Why a Purposeful SP Retirement Plan is

Designed Better


Table of Contents

  1. Lower Your All-in Plan Fees

    • Why Lower Fees Are Important

    • Why You’re Fees Are Likely Higher

  2. Your Fiduciary Obligation and Liability

    • Delegating Fiduciary Responsibilities

    • Most Providers Won’t Take The Responsibility

  3. Learn about The advisor

    • Schedule a Meeting

Our plans are built on conflict-free advice, expert regulatory and tax compliance, the protection of a third-party custodian, and the opportunity to delegate company fiduciary responsibilities.

Although the basics are the same between 401(k) providers, there are important difference in the benefits and protections our clients receive compared to other providers. Because we are independent of the custodian and recordkeeper, we sit on the same side of the table as your business to help keep fees low.

You’re already paying an advisory fee to your current plan provider, but you may be getting an advisor who represents the broker-dealer or insurance company rather than your company.


A FIDUCIARY & FEE-ONLY ADVISOR

As a Registered Investment Advisor, I am required to serve my clients' interests first. And I don’t accept commissions or other kickbacks from the investments in your plan. This protects both your employees and your company.

You may also delegate much of your fiduciary obligations to us, reducing the liability exposure to your company.


AN EXPERT ADMINISTRATOR AND RECORDKEEPER

Your plan administration, tax filings, & regulatory compliance are provided by our partner, Professional Capital Services.

Founded in 2001 by tax and ERISA attorneys who saw the need for a conflict-free, full fee disclosure, no hidden agenda retirement solution; PCS is a leader in retirement plan administration and recordkeeping.


A PROVEN AND STRONG CUSTODIAN

Your plan’s assets are held either at Charles Schwab or TD Ameritrade. Neither Purposeful SP nor PCS have access to plan moneys.

Using a third-party custodian also means there are additional checks and balances to ensure plan money is secure, further protecting your plan and reducing company liability.

Is your 401(k) provider getting paid on the back-end
through commissions, sales loads, and other kickbacks?

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Transparent and fewer conflicts of interest

Lower Your Fees

Purposeful SP 401(k) plans are built on full and transparent fee disclosure without the conflicts of interest that come from accepting commissions or other kickbacks. Our plans fees are designed to start as a low percentage of the plan assets and to get smaller as the plan grows.

To eliminate any incentive to choose investments or providers that could increase your fees, we don’t accept compensation from the investments, the custodian, nor the administrator of the plan. To further eliminate conflicts of interest, any sales loads, 12b-1 fees, or other investment compensation received by PCS is immediately credited to your account to lower the cost of the plan.


Why Lower Fees are Important

Aside from the obvious benefit of saving your company money, lower fees also increase the retirement benefit to your employees and reduce the likelihood your company will be sued over the plan.

While a fee difference of 1% may seem insignificant, the higher fee can have a dramatic impact on employee retirement balances when they retire. As an example: assume the employee and employer match contribute $500 per month to their 401(k) and the plan earns a 9% average return over 35 years. With a 1% fee for the employees, the employee would have $1.15 million in their account at retirement. But if the plan charges a 2% fee to the employee, their account balance drops by a quarter million dollars.

This significant impact is one of the many reasons 401(k) lawsuits are on the rise. And sadly, many of the biggest 401(k) providers in the country are being sued by their own companies because of the high fees they charge in their retirement plans. Even as your adviser is telling you how great the company’s 401(k) plan is, they may be suing the provider for the high fees the company has in the plans.


Why Your Fees are Likely Higher

Retirement plans have often been a cash cow for the national companies that provide them. Conflicts of interest abound when the advisor on the plan is an employee of the same company that custodies the assets, provides the investment options, and acts as the recordkeeper and administrator of your plan.

While all-in-one shopping might seem convenient, the lack of checks and balances allows for profits to be buried throughout the retirement plan in the form of investment expense ratios, sales loads, 12b-1 fees, commissions and other hidden compensation.

Not only do supposed advisers on plans often charge fees well in excess of what a financial advisor typically charges, the advisors also tend to recommend including their company’s mutual funds, annuities, and ETFs in the plan’s investment choices. And advisers often earn bonuses for increasing the profitability of your plan for their company.


Additional RESOURCES & ARTICLES

Did you know your company and the owners
may be personally liable for the 401(k) plan?

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Delegate Fiduciary Obligations to

Reduce Your Liability

Purposeful SP retirement plans can be structured to transfer much of the fiduciary liability from your company to ourselves.

As the sponsor of a retirement plan, your company has a fiduciary responsibility (and liability) to protect the assets of the plan for the benefit of employees. This means your company and the owners can be sued and held legally liable for problems with your retirement plan.


DELEGATION of Fiduciary Obligations under Erisa 3(38) + 3(16)

With Purposeful SP 401k plans, we act as the fiduciary on the plan. Your company delegates authority to us in writing to make discretionary decisions on the investment options within the plan.

In addition, your company may also delegate the administrative functions of the plan to PCS. This includes the regulatory compliance, tax filings, and notifications required by law.

This delegation shifts your company’s role from being an investment and legal expert to acting as a manager who monitors the investment and legal experts, which greatly reduces the company’s liability for the plan.


Most Providers offer NO DELEGATION or 3(21) Delegation

Typically, the plan sponsor (your company) legally makes the investment choices for the plan, functions as a prudent investment expert, and ensures regulatory compliance. This means your company retains full liability for any potential problems even when you have an adviser on the plan.

The reason for this is most plan advisers are actually legally sales representatives of their company. Plan providers often offer a menu of proprietary insurance or mutual fund products, and may offer recommendations (not advice) from a non-fiduciary advisor, but your company is still fully liable. Many companies believe they have delegated their fiduciary responsibility to an outside company but in reality have not.

Joshua D. Escalante Troesh

Advisor Profile


In addition to being a fiduciary financial planner; I am a Tenured Professor of Business, hold an MBA, and have passed the rigorous CFP Exam.

I have been quoted in Forbes, U.S. News & World Report, and other media and currently am the top-ranked financial advisor nationally on Investopedia’s Advisor Insights as ranked by the helpfulness of answers to audience questions.

Schedule a no-cost, no obligation consultation with me.

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