austin3515

457b and 457f commingled accounts

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I can't think of any reason not to commingle a 457b and 457f investments? OK, there are different vesting rules, but it's no different than a 401k FBO account with PS and 401k.  Let me know what others are doing.

Also, it would be one single Rabbi Trust for both plans.

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I generally see combo 457(b)/(f) plans commingle all investments in one rabbi trust and track the (b) vs. (f) balances separately in recordkeeping.

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i.e., in one brokerage account, with the allocation of gains made once a year at plan year-end, correct?

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As far as the number of individual accounts, I'm not entirely sure as I'm removed from that level of detail. I've seen some where they maintain separate accounts (whether physically differentiated or just recordkept separately, I don't know) for each participant, but my sense is that's usually where there are 457(b) elective deferrals as opposed to, say, one 457(f) employer contribution going in at the end of each year. Regardless all the assets whether (b) or (f) are in the same place, just tracked separately at the employer-level for vesting, (b) limits, etc. I'm not sure if it's just the plan structure, but our clients generally are able to get properly valued account balances with investment gain/loss more frequently, usually at least monthly.

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I'm assuming you're talking about a nongovernmental 457(b)?  In that case, since in theory both plans are unfunded, I can't see an issue with commingling the assets, provided that the plan documents do not forbid it.

I'd be more concerned about this with a governmental plan, which has to fund a 457(b) plan.

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Yes, nongovernmental.  Classic federal governemtn to who have 2 plans nothing alike defined in the same code :)

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I asked an attorney and she pointed out my Rabbi Trust Document says the Trustee has the right to: 

Quote

commingle the assets of the Trust with the assets of any other trust established for the purposes of holding funds set aside to meet The Employer’s future obligation to provide supplemental retirement benefits to Plan Participants, and to hold such assets for purposes of investment and administration as a common fund in which the respective trusts have undivided interests;

I'm pretty sure the attorney who wrote this for me started with the IRS's model Rabbi Trust.

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