In Individuals, Market Outlook & Strategy

What are Industry-Average Fees for a Fiduciary-Grade 401(k) Financial Advisor?

A small business owner looking for wealth management services is confronted with a variety of fees and services based on the provider.  In many cases, the small business owner has no objective criteria to compare different proposals.  Thankfully, a recently published study on the average costs of fiduciary grade financial advisors offers some key benchmarks and casts Sapling’s services in a very favorable light.

Employer Fiduciary, a record keeper that prides itself on competitive costs in the small business 401(k) market, has just completed a major study of small business 401(k) plans.  This study benchmarked 753 plans, by the size of the plan.  Also, the survey group is set of plans that are paying attention to details, therefore will be high-quality comparisons.

What is unique about this study is that it gives details on small business 401(k)s below the $1 million asset size.  Many of comparable surveys do not go below the $1 million in assets mark.

Sapling stands out on service within this cost competitive spectrum.  I will point out the striking similarity between these plans (table below), in terms of size & participants.  In all cases, Sapling’s fees were at or below each segment category.

Sapling’s Fees are at or below Study Averages

 

We Challenge Anyone to Match Our Level of Service

The study by Employer Fiduciary does not address the level of service that these advisers give to their plans.  I challenge any provider to match Sapling’s level of service.  I can offer a superior level of service, due to my experience in the field, 401(k) business line focus, training, and my overhead structure as a solo practitioner.

  • Accredited Investment Fiduciary (AIF): Currently I hold this designation, which means that I have gone through sub-specialty training in the area of advising ERISA retirement plans.  As of this writing, only 1.7% of financial advisers hold this designation in Washington State and follow the specific processes outlined by this organization.  While gold standard processes do not guarantee better returns, it does prevent unnecessary mistakes, which can reduce investment returns in the long-term.
  • Two Levels of Fiduciary Service – Section 3(21) & 3(38): I have two levels of service, which I price at 0.50% of assets under management – Section 3(21), and 0.75% of assets under management – Section 3(38).  The 3(21) level of service is an excellent value and is what most of my current clients choose for their firms.  However, the higher level of service appeals to plan sponsors that want more support, specifically in the area of offloading investment selection liability and additional adviser support (after hours support, additional participant guidance on investment selection & fit, access to basic financial wellness and financial plan tools).  For all of my accounts that have more than $1,000,000 in financial assets, I offer an upgrade to the 3(38) level of service at the 0.50% rate.

 

A detailed list of Sapling Wealth’s 401(k) expertise and fees is compared to average advisors in the table below.

 

 

Are you ready to get the have your 401(k) managed by Sapling’s expert advice and lower than average fees? Get in touch for a free consultation, and let’s review your needs today.

Recent Posts