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Advisor Plan Administration and Costs: For Financial Advisors

Plan Administration

Folio Institutional provides custody for the plan assets and the brokerage services with which fiduciaries manage plan investments. Alliance Benefit Group Carolinas serves as the Third Party Administrator (“TPA”) for all Folio(k)™ plans, providing all administration, recordkeeping, and compliance reporting. For more information about Alliance Benefit Group Carolinas (ABG), please see their website at www.abgcarolinas.com. As a financial advisor, you will serve as a plan fiduciary and provide professional investment management services.

Cost Structure

Pricing is generally customized based on plan assets and the number of participants. For example, as assets increase the overall percentage of fees tends to decrease. Conversely, if the number of participants in a plan were high but assets low, the administration costs would be higher.

Below are two sample plans for illustration of Folio(k)’s cost structures. To determine the approximate all-in cost of the plan as you will offer it to sponsors, add your own fee as investment advisor, according to your fee structure, to the average costs below. Sponsors can charge the Folio(k) plan fees to plan assets, along with your fees or they can pay the plan’s cost themselves, out-of-pocket.

Example Folio(k) cost structures $1M plan/50 participants $5M plan/250 participants
Folio(k) Custodial Services 25 bps 15 bps
ABG Recordkeeping and Administrative Services1 40 bps 15 bps
Average ETF Internal Investment Expense Ratios2 26 bps 26 bps
Total Average Cost before your advisory fee3 0.90% of plan assets 0.55% of plan assets

Available Add-On Services

  • Paper statements—$4 per account balance per quarter
  • Paper enrollment books—$6 per book
  • Self-directed retail brokerage through Folio Investing—Annual, monthly, and per-trade pricing plans available. If requested, ABG may charge an additional accounting fee for consolidated statements.

1. Minimum ABG fee is $600 per quarter.

2. Assumes Target Date Folios and the included ETF components are the exclusive investment choice, as of September 19, 2012. Expense ratios of the ETFs have already been included in the Total Average Cost). Folios can include stocks—stocks carry no inherent expenses—which could decrease the total cost of a Folio(k). Mutual Funds or ETFs other than those in the Target Date Folios that charge separate transaction or asset-based fees may change the expense ratio as well. Further, the ETFs included in the Target Date Folios may change over time, thus changing these Average ETF Internal Investment Expense Ratios. Folio Institutional has no control over these charges.

3. Does not include your investment advisory fee. The total average administrative cost for the plan as you would offer it to sponsors should be increased by an amount equal to your investment advisory fee.