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ISO 401k service provider recommendations for small company <10 employees

Ann Carney's Profile

Hi all,
I am the COO at a small startup (8 employees currently) in Corvallis, OR.  I am looking for recommendations for good, but reasonably priced, 401k providers.  I have heard good things about Schwab (little or no fees and flexible investment options) and got a quote from Intuit ($75/month plus set up fee of $495).  I was curious to hear what other people have used (and liked) in the past.  
Many Thanks!
 

Answers

Bryan Frey
Title: VP Finance/Corp Controller
Company:
(VP Finance/Corp Controller, ) |

Ann:

I have used a number of 410k providers at companies big and small. I find the bigger providers have more automation and can integrate more easily into 3rd party systems (like ADP, etc.). However, they like to charge more fees, their customer service is far worse and you get handed from account manager to account manager so you have noone fighting for you on their end when they make mistakes (and they all do) or when you want to do/change something. For a small company like yours you would be the tiniest ant of a customer at Schwab or Intuit 401k.

The best of the smaller providers give you integration with bigger systems AND give you the personalized treatment that allows you to really "let go" and trust the provider. Counter-intuitively, they can also give you better pricing from a TCO perspective b/c they will more readily waive fees or look for creative ways around all sorts of costs - the big guys don't (and probably can't) do that.

The best 401k provider that I have used is Wespac. They are a regional player (not too big, not too small). I have worked with a guy named Nelson Chia there and he really knows his business. His people are great and they run a tight ship. They are (or at least were) on the Schwab system so they have the "big company" tools and integration available as well. It's been a couple of years since I used them, but I used them at two straight companies (and I'm a big shopper when it comes to services) and was very happy that I did.

Ann Carney
Title: COO
Company: Inpria Corporation
(COO, Inpria Corporation) |

Thanks Bryan. I am not familiar with Wespac but will check them out. Many thanks!

Achaessa James
Title: Product Manager
Company: National Center for Employee Ownership
(Product Manager, National Center for Employee Ownership) |

Hi, Ann. You might want to consider contacting TriNet - http://www.trinet.com/ - they provide outsourced HR and benefits to start-ups (including 401k). Their business model aggregates all employees across all customer companies to qualify small companies for the discounted big company rates. Our company has used TriNet since 2005 and we're happy with their performance and cost.

Phil Murray
Title: VP of Finance & Administration
Company: Kimbia, Inc.
(VP of Finance & Administration, Kimbia, Inc.) |

I know that at one point ADP was pushing their 401k management services; I imagine that would be available to you if you used their payroll service, even though it's a small employee group.

Joseph Bowman
Title: VP Distribution
Company: The Payroll Source
(VP Distribution, The Payroll Source) |

Most Payroll Services or PEO's offer 401(k) management services as either a value added benefit based on employee count/partisipation or for a fee but understand that management and investment are 2 seperate functions. Any reputable TPA or "Third Party Administrator" can "manage" the 401(k) ( provide testing ect.)but the account would still require an investor/brokerage house like Transamerica. Because of the economies of scale a PEO may offer less expensive management (TPA) fees and have alliances with investors who have lowered their fee based services. Do some research.... I know of several.

Joseph Bowman
Title: VP Distribution
Company: The Payroll Source
(VP Distribution, The Payroll Source) |

Slate, Disharoon and Parish in Knoxville, TN manage our
401(k) with TransAmerica and are quite inexpensive. I would talk to William Parish... Tell him Joseph Bowman with TPS sent you and he'll break it down for you. I trust them.

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