Empowering Your Retirement Decisions

Q: I already have a financial advisor.

A: 401k.partners complements your existing financial advisor rather than replacing them. We specialize in offering retirement plan services that your current advisor might not, such as specialized asset allocation, tactical investment strategies, 401k loans for contributions or stock purchases, and comprehensive tax planning. Our expertise extends to optimizing Social Security benefits and retirement distribution strategies.

Many advisors might not fully engage with employer-sponsored plan accounts due to a lack of compensation for these services, potentially leading to a lack of attention to your retirement plan's specific needs. This might manifest as infrequent or non-specific advice on adjusting your investment allocations, which can significantly impact your retirement planning.

Key Questions for Your Current Advisor:

• What unique investment options do you offer beyond my company's mutual fund selections?

• Can you explain the risks associated with target date funds?

• How do you plan to minimize the risk of my 401k assets during downturns?

• Do you provide tactical management for my investments? What criteria trigger a reallocation out of equities?

• How do you propose to protect my investments in a volatile market without tactical solutions?

• What strategies do you offer for managing my company stock holdings tax efficiently?

• If I don’t show you my 401k statement, are you aware of its performance?

• How do you proactively manage my 401k, rather than just reacting to changes?

• Can you assist me in maximizing my company's matching or stock purchasing programs through loans?

Working with a specialist like 401k.partners ensures that every aspect of your retirement planning is meticulously managed, similar to how you would seek a specialist for complex medical needs rather than relying on a generalist.

Q: Why am I limited to only these 40 mutual funds?

A: In many cases, you are not. As the plan sponsor, your employer has worked with a plan rep to select these fund choices. They are under a fiduciary obligation to include a diversified list of options. However, there are over 18,000 mutual funds, over 2300 Exchange Traded Funds, thousands of individual stocks and bonds along with a variety of other investment vehicles. If your plan offers a Self Directed brokerage account you can choose from any investment.

Q: What is a Self Directed Brokerage Account?

A: Many plans offer a SDBA, however only 3% of the participants in those plans are aware that it is an option. An SBDA is an election you can make in your plan opening up a window to the investing world. Through this account you have the freedom to invest in any way you choose, not just the 30-40 mutual funds the plan limits you to. An SDBA does not remove your assets from the plan. All matching and continuing contributions are still available.

Q: Why have I not received help with my 401K?

A: Plan reps are paid based on the value of the entire plan, not separately on your individual account. ERISA law, which governs all plans, only requires the rep to ‘offer’ to meet with participants. Since they are not paid to, or legally required to help you, individual participants are often neglected. Further, your employer is legally prohibited from directly helping you with your allocations.

Q: I’m not sure I ever did make any allocation selections. Where is my contribution going?

A: Recent laws require plan sponsors to select a ‘default’ account for you if you fail to choose your allocations. These are usually target date funds, which have proven to underperform the markets although they may add some safety.

Q: What if I want the advantages of a SDBA but don’t want to manage it?

A: 401K Partners offers services to help. We specialize in helping participants with these accounts. The process is simple and easy.

Q: Does 401K Partners work for my employer?

A: 401K Partners is an independent provider of retirement plan allocation solutions. It is not controlled or influenced by your employer. 401K Partners provides a service that your employer legally cannot and the plan rep has no incentive to provide. 401K Partners is familiar with your plan and assists with navigating all of your options.

Q: How much does 401K Partners cost?

A: 401K Partners has options that are no additional cost to participants. There are also choices that do have a fee, however when all costs are considered, the net result may be lower than the internal operating expenses of other solutions. All fees are carefully compared so that you are informed of all costs  and can make a selection that is best for your situation.

Q: If I work with 401K Partners and I retire or change jobs what happens to my account?

A: As with all 401K plan assets your account values are yours. You may want to roll the value into an IRA and continue to work with 401K Partners . Your employer matching will have a vesting schedule where you may not be entitled to the full amount of their match, but the amount you contribute, by law, is all your money. There are tax considerations that apply to all plans assets and 401K Partners can assist with avoiding unnecessary tax and penalties.

Q: How do I set up a SDBA?

A: 401K Partners has a simple and easy process to guide you through the steps. Most people can complete this completely online, however we offer support at all levels including having a live, US based Associate walk you through it over the phone or webcall.

Q: What is a TRUE Self-Directed 401(k)?

A: A true self-directed 401(k) provides you with checkbook control, meaning you can make investment decisions and write checks for investments without needing approval from a financial institution​​.

Q: What can I invest in with a Self-Directed 401(k)?

A: You have a wide array of investment options, including stocks, bonds, exchange traded funds and mutual funds​​.

Q: Are there any special taxes or penalties for Self-Directed 401(k) investments?

A: All taxes that apply to your 401k also apply to your SDBA.