New 403b for Small NFP-How much time/expertise required?

[Guest Nicholas]

Greetings-

I realize that this forum deals with some very advanced and complicated 403b issues and many of you are professionals with a focus in Fiduciary Guidance. So forgive the ignorance implicit in my posting. However I do think this relatively general question and the corresponding input may be a valuable contribution to this forum.

Background:

I am the CFO for a small 501c3. I am a CPA but know very little about administering 403b plans. I do the payroll in-house using Quickbooks. We have 5 employees and I have been tasked with setting up our 1st 403b plan. There will be a 1% employer contribution to the new 403b. I know we are required to be ERISA compliant. We plan on hiring a professional to draft our Summary of Plan Description.

Questions:

What kind of time will I have to put in on a monthly basis to maintain our 403b once it's set up and running?

Is maintaining our 403b something that requires expertise above and beyond prudent investor level?

Am I getting in way over my head?

Is it practical to set up a 403b Plan for a 501c3 that is small and operating with a limited admin and overhead budget?

[Lori H]

Nicholas,

1) Very little time will be alloted to maintaining your plan on a monthly basis. With 5 employees, you will have enrollment, which the advisor will assist you with and submitting with holdings.

2) I would hire a TPA(Third Party Administrator) to oversee your plan on an annual basis. A plain vanilla 403(b) with employee/employer contributions SHOULD run no more than $1000 annually to maintain. This will take some of the administrative burden off of your hands. It should also keep the plan in compliant with the regs.

3) No

4) Yes

[Guest Nicholas]

Thanks for the insight!

Sincerely

NJB