My client was concerned about the fees they were paying fortheir third-party administrator (TPA) on their retirement plan, whichis a defined benefit, 401k with profit sharing. We originally designedthis plan to enable the business owner to tax-defer than the $46,000allowed by traditional profit sharing plans.
His primary concerns now were:
What are all the fees that I'm paying?
This is adding up to a thousands of dollars per year - are these fees reasonable?
Is my TPA competitive on pricing?
How do the invoices I received reconcile against the expenses?
After reconciling the invoices against the fee schedule I was able tosort out all of the expenses. At the same time, I obtained quotes fromother TPA's so I could benchmark the fees. Another reputable TPA wassignificanly lower in price so I scheduled a site visit to conduct duediligence.
We found that not only was this TPA lower in price, but they have awell-run operation. The client decided to move to this new TPA, offering the same services at significantly lower cost.