Low-cost small business 401K or 403B plan?

[monstermonster]

So I've been tasked with finding us a less expensive 401K plan at my organization - more about that here- currently with only 4 employees contributing, we pay $600/quarter just in administrative and recordkeeping fees to fidelity. My work wanted to take it away entirely and move us into IRAs - which of course doesn't work for me because I already max out my IRA.

Unfortunately, I thought I had found a solution in Vanguard small business 401K or 403b, but the administrative costs are even higher - $3500/year with a $1000 startup fee. The Simple IRA has no fees but requires a match - 2% or 3% and we currently can't afford that either.

I'm really struggling. I love my job, but if the 401K is taken away, I might just walk (at least I have some FU money). I proposed coming up with a cheaper solution, but the amount we're paying right now actually turns out to be a pretty good deal for the recordkeeping.

Some mustachians must own small businesses or act as the fiduciary for them? Any suggestions I haven't turned over yet?

[monstermonster]

...crickets make me nervous.

[DaveR]

Fidelity is on the short list of affordable 401(k) fiduciaries. One of my companies uses Ubiquity (https://www.myubiquity.com/). You should be able to get a 4-employee plan for $105/mo, flat rate.

EDIT - I just looked and they have a referral program. No obligation, but if you are interested, PM me and I think I can get you a month free.

[monstermonster]

Fidelity is on the short list of affordable 401(k) fiduciaries. One of my companies uses Ubiquity (https://www.myubiquity.com/). You should be able to get a 4-employee plan for $105/mo, flat rate.

EDIT - I just looked and they have a referral program. No obligation, but if you are interested, PM me and I think I can get you a month free.

Thanks! I have an appointment scheduled with them to chat about it. I don't know if that includes recordkeeping or not. But if we can get it down to $105/month, then I can make the case I'm "saving us 50%". And then perhaps I can teach a personal finance class to everyone and get our enrollment up from 3 employees to 24!

[katsiki]

You might check out www.surepayroll.com.  They seem pretty low cost.  No experience with their 401k but they do a great job with payroll.

[TomTX]

If Fidelity doesn't work out, check with Vanguard.

If they're both too expensive, look at a SIMPLE IRA at Vanguard. That costs $20/year/participant until you get assets up. Lower limits than 401k, but doesn't affect your personal IRA limit.

[NorCal]

For a plan that small, there unfortunately aren't a lot of options.

My company uses Empower retirement.  I believe their admin fees are lower (I'm not sure though), but they make up for it on funds with pretty high expense ratios.  I normally wouldn't recommend them, but if it's a choice between expensive funds or no 401k, you'd probably be better off.