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| How long does it take to set up an account? |
It's possible to set up an account in a couple of days. Once you fill out the Application Request you will receive the application kit from us by email typically within the hour. After reading the material, complete the application forms and mail or FedEx them directly to the mutual fund investment company that administers the plan.
Once your paperwork is received by the investment company they will set up the account usually by the next business day and begin the request for your rollover (if applicable). |
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| Is there a set up fee? |
| There is no set up fee for the Self-Employed 401k or the 403(b). Please refer to Fees section |
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| How long does it take for a rollover? |
| The time for a rollover depends on how quickly your custodian honors your rollover request. The request for a transfer of assets will be sent without delay to the custodians of your existing IRAs and/or other retirement accounts that you select. Be mindful that some custodians require that you fill out their own forms or that you call them directly before they will process your rollover. You may want to call your previous employer or custodian to find out how long it will normally takes them to process a transfer/rollover request. |
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| What is the maximum I can borrow? |
| With our Self-Employed 401K or the 403(b) you can borrow up to $50,000, or one half of your account balance, whichever is less. However, these limits will be reduced if, during the prior 12 months, you had loans from your account and any other plans with the same employer (please refer to the Terms and Conditions of the loan brochure for more details). The minimum investment to open an account thru us is $10,000 either from a rollover or other source. |
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| How often can I borrow from my account? |
| You can request a loan once each calendar year, as long as the funds have been in your account for more than 15 days and you have no loans outstanding in your account at the time of your request. |
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| What is the interest rate on the loan? |
| Your loan's rate of interest will be the prime rate on the business date prior to the loan's approval, as published in The Wall Street Journal. This interest rate will be fixed for the duration of the loan. |
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| How much time do I have to repay the loan? |
| You must repay your loan in equal monthly installments over no more than a five-year period, unless the loan is used to acquire a principal residence, in which case the loan duration period can be up to 10 years. Your first monthly payment is not due until at least 28 days after the issuance of your loan check. You may repay your loan balance at any time, without a penalty. |
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| What happens if I miss a payment? |
Upon failure to make a payment by its due date, your loan is automatically declared in default. If you do not cure the default by submitting payment within 90 days of the payment due date, the default will be reported to the IRS on Form 1099-R, marking the entire outstanding balance of the loan amount as a taxable distribution, subject to any applicable penalties. Once reported the defaulted loan balance will further reduce any amounts available for future loans
Click here For more FAQs about the Self-Employed 401(K) and Its Loan Feature
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