Obtaining 403(b) plan documents

[Guest Stacey L Miller]

A small not-for-profit needs a 403(B) plan document and adoption agreement. Investment companies aren't interested in providing a document because the participants' money goes to a variety of investors. The not-for-profit is hoping to avoid the expense of going to an attorney or accountant for their document. Does anyone know alternatives to obtaining a document? I'd appreciate any advice.

------------------

staceym@elmore-cpa.com

[Ellie Lowder]

I am aware of one document service provider: Pen Serv, 1215 Meetinghouse Rd., Ambler, PA 19002, phone 215-628-8950. Will provide document and updates. There are others - this just happens to be one that has been recommended from time to time as a good resource.

[Guest Lyric]

I STRONGLY URGE your nonprofit not to work with an insurance company, and to go for a 403(B)7 plan which enables you to invest in mutual funds rather than annuities or so-called "variable" annuities. (The 7 is the operative factor here, which broadened 403(B) options.)

Insurance company products are very expensive (lots of loads, fees, commissions, and penalties) and are usually quite inflexible. Annuities are a very inefficient investment vehicle, and should be reserved for special circumstances. In today's market they don't make sense, and should not be the first choice of retirement plans, especially for employees of nonprofits who may not get matching employer contributions. With a no-load mutual fund, every dollar goes to work for you.

Approach the Vanguard Group, who have an excellent track record with no-load funds. Their philosophy is to keep costs as low as possible (no frills, no mandatory use of a broker requiring commissions). They will talk you through the process and send you all the documents you need. They have dozens of different funds to choose from covering the whole gammut of sectors and investment instruments, yet you will have the convenience of dealing with just one organization. You can reach them at http://www.vanguard.com/ (They also have an 800 number Mondays to Fridays.)

Check out Vanguard's site -- you have nothing to lose. There are others too (T.Rowe Price, etc.) which you can research, but Vanguard is generally acknowledged to be one of the best fund families you can work with.