Lowest charges for a Simple plan

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Sep 14, 2009 5:07 pm

Working on setting up a Simple IRA plan for this client.  Most people in my office use American Funds b/c supposedly their fee is the lowest ($10/year) and I think they’re ok but I’m wondering if there is any other company.  I just called Fidelity and their fee is $30/year.  I know it’s trivial but when I’m sitting with the business owner, I want him to be happy b/c there are a lot of other opportunities we’re working on as well.  Thanks for the help!

Sep 15, 2009 11:08 am

The lowest fee I have ever seen for administrating an IRA or a SIMPLE IRA is Calvert Funds. Calvert gives you the option of paying a ONE TIME fee of $60.00.

I do not use Calvert Funds unless the client wants a socially responsible investment.

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Sep 16, 2009 9:54 am

Thanks for the info Jack.  That’s good to know if I come across that opportunity. 

Sep 16, 2009 5:17 pm

Army, the expense that matters is the fund expenses and not whether a plan charges $10 or $20.

Sep 17, 2009 7:04 am

Have to agree 100% with anonymous, the admin fees are trivial.

Want to really convince your client that you are exploring the options? Give him comparative costs for 1, 5, and 10 year durations for competing SIMPLES using the same contribution and asset numbers and including not just the admin fees but all of the fund fees, front end loads, investment expense, 12b-1s.

Throw in the funds historic performance and a monte carlo to see if you really get what you pay for on the performance side.

Then you’ll have an impressive argument for one family over another

Oct 2, 2009 8:47 pm

Thanks for the responses.