Call us at 818-769-4600. Ask to speak to Pete Austin (Actuary). We'll discuss fees openly and candidly with you.

Annual Service Fees

We charge a flat annual rate for pension plan administration. We set this rate based on your plan and others like it who have a specific kind of pension plan. If your plan has rollovers from other plans in it, or if there are other complications which take us time (such as a large number of employees who are participants), we will charge more, but again we set this at a flat annual rate for similar clients.

For example, a typical Defined Benefit Pension Plan starts at about $1,100 for annual fees.

A typical Profit Sharing, Money Purchase or 401k Plan starts at about $800 for annual fees.

We charge a lower annual fee and lower initial set up fee for traditional Profit Sharing and Money Purchase Pension Plans, because they involve less work than a Defined Benefit Pension Plan. For the Age-Weighted and New Comparability variety of Profit Sharing and Money Purchase Pension Plans, we charge a bit more than for the traditional variety of Profit Sharing or Money Purchase Pension Plans. Our 401k Plan fees depend on whether we are doing just the 5500s and the annual ADP and ACP testing required, or also doing the accounting for the investment allocations.

Inital Setup Fees, and Plan Restatement Fees (Documents)

Initial setup fees include the initial plan document preparation. They normally also include all discussions related to setting up the plan, and obtaining IRS approval of the plan.

A typical Defined Benefit Pension Plan or 401k Plan costs about $1,000 for the initial set up or complete restatement (including the full plan document).

A Profit Sharing or Money Purchase Plan costs about $ 950 for the initial set up or complete restatement (including the full plan document).

All pension plans must be completely restated (i.e. a new replacement plan document must be drawn up) in 2002. No exceptions, the IRS requires it. This is a great time to take your Standardized plan and convert it to our Non-Standardized plan.

Annual services fees and initial set up or restatement fees shown above are for a new plan, with less than 5 participants, and without any rollover plan being included with this plan as a combined trust for reporting purposes.

We do not add on extra charges during the year, except in quite unusual circumstances where the work for your plan may be well above the normal for a typical plan. We want to keep your business.

Special Projects Fees

Sometimes other special projects come up: for example if the IRS or PWBA audits your plan (fairly rare); or if you terminate your plan. We charge separately for these functions, which are one-time projects, and fairly uncommon.

General

Normally, you will see only the annual fees being charged by us. However, we do have to do plan restatements in 2002.

We reserve the right to increase this fee schedule at any time. However, be aware that we want to keep your business. We really want you to be clients for many years.

We rarely lose clients, and almost never over fee issues.

Incidentally, we do not share fees with other advisors. We also do not take any fees or commissions from any service providers to your plan, such as investment managers or others. In this day and age of "bundled services", it is becoming much more common to give fees to people who refer you business, or take fees or commissions from people who you refer business to, but this is not our style.

Special Issues With "Do It Yourself" Pension Plans

Many business owners who have under $100,000 in the pension plan, and no employees other than the owners, have been told that they do not need services from us or any pension experts, and need not file pension 5500 returns until they get to $100,000. The same folklore says that when the amount goes over $100,000, all that is required is to file a form 5500 each year. Other employers, who have employees on the pension plan, believe that they don't need experts to help them.This is bad and misleading information.

If you have a pension plan which has not been administered by a full-time pension administration firm, please call us at 818-769-4600. We will look over your reporting and plan documents, and figure out what you need to do.

We think it is dangerous for the government to (a) require you the business owner to have your pension plan in conformance with all of the many pension laws that apply, but (b) allow you a pathway which says that no pension expert need help review your plan on a regular basis. This is just asking for trouble. You don't know what you don't know. Through no fault of your own, you may violate a bunch of pension rules, and subject your plan to severe penalties. And in fact, because pension plans enjoy such a tax-protected status in our country, there has been a huge body of rules built up around pension plans, with severe penalties for non-compliance. We also believe that the financial institutions who promote their own Standardized Adoption Agreements, and who invest your pension money, ought to be accountable at least to ensure that your plan documents are kept up to date. If they let you use their plan documents, they ought to be accountable to ask you to provide them with up-to-date copies of these plan documents on a periodic basis. Failure to update plan documents (nonamenders) is the leading cause of IRS audit failures for pension plans with less than 10 participants; failure leads to severe penalties to correct the failure...see www.benefitslink.com/links/20000920-006990.shtml for the September, 2000 GAO report on IRS pension audits and the related VCRP program.

We always give more value than we charge. We take over any number of plans that are the one person & assets under $100,000 type, and we always have some suggestion or change that is greatly beneficial to the client, either in terms of increased contributions or flexibility in adding other investment managers, or other types of investments.

However, paying us is also like paying an insurance premium; we are good caretakers of the legal requirements for the pension plan, which lets you sleep nights.

When we are asked to get involved with a pension plan where there has not been regular annual reporting by qualified pension experts in the past, we hold our breath and tighten up our toes until we have checked all aspects and documents concerned with the plan and its operation, and determined that there are no significant plan document defects ( and particularly failure to amend on a timely basis for changes in the law), and operational defects. We have turned down a fair number of such plans, unfortunately, and will continue to do so, referring them to specialist pension attorneys we know for major surgery before we can take them over. This is a very significant expense for a small plan, but it has to be undertaken to put the plan back into compliance, and involves a lengthy negotiation with the IRS, and payment of hefty penalty taxes. It can be simply avoided by paying for insurance along the way.

The airplane ride is much less bumpy with us because we plan the route, and check out all the weather, and know how to re-route the flight plan to avoid bad weather. We don't fly in bad weather, and we don't fly beyond our capabilities.

The fact is that by and large business owners, and unfortunately many of the advisors to business owners who are not themselves full-time pension administrators, do NOT know enough of the rules regarding pension plan reporting, qualification, operational defects, contribution date requirements, and others. We know, we see violations all the time. Many plan sponsors and their advisors think it is sufficient to file a 5500 report each year, and totally ignore the reuirement to update legal plan documents etc etc, because they are unaware of the update rules.

Do yourself a favor; pay our fees, fly right, and life will be much simpler, and better, for everybody.

Fee Summary

We will make your pension life better, and you can work on making your pension fortune larger with our suggestions on plan design, contribution flexibility and your own ability to use several investment advisors with our Non-Standardized plan documents. You will have a much smoother trip if you fly with us.

To File or Not To File..One Person, Assets Under $100,000

We always recommend that plans with assets under $100,000 and only owners in the plan still file 5500 forms each year. There are two real advantages; (a)if you file 5500 forms, the statute of limitations starts running. If you don't file, the statute never runs out, and (b) if we prepare the 5500 forms and the plan valuation, then we have done our checks to make sure your plan is in compliance with all of the pension plan laws.

We Are Great In Bad Weather

Oh yes, if you hit bad weather, then our value really kicks in; we are great bad-weather co-pilots, whether it is with IRS pension audits ( which we handle at our offices directly with the IRS, and you need not attend ), or if there is some mix up that we all discover that needs attention, like you have some leased employees you forgot about, or there is some problem with labelling or registration of a specific investment of the plan.

Your pension plan ride should be fairly simple. Start it right and it will be simple.