ASA Empower 401k Change

TO: Atlantic Southeast Airlines 401k Plan Participants

On November 2, 2015, some changes took place in the ASA Empower 401k plan. In the letter to plan participants, Empower announced that they were changing the share class of the fund. Different share classes of mutual funds generally give discounts on management fees for larger investments. It makes sense that a 401k plan the size of ASA’s should be getting preferred pricing. The Empower notice is actually moving funds from the discounted share classes to, in some cases, the most expensive share class.

If the funds stay the same, this is not good for participants in the ASA 401k plan. However, after speaking with ASA ALPA R&I about their discussion with the company, it appears that this is a transition period into a more transparent 401k plan. In the past the fees have been shared by the plan participants, meaning the more expensive funds covered the plans administration costs, as well as the larger accounts. Funds like the large cap index fund did not cover any admin costs. Going forward ExpressJet has indicated that the participants will pay a monthly fee for administration, allowing the company to negotiate better rates on the current line up of funds and more fee transparency. I have seen a list of what they hope to negotiate and the fees are very reasonable. Why this was not all done at once, like SkyWest and Legacy ExpressJet was not explained.

Until we know the final cost of the funds, I am recommending no changes to Wiser Wealth’s current recommended ASA 401k models. Should the expenses remain the same, we will have to adjust accordingly.

Click here for the latest FREE 401k allocations.

Have more questions? Email me at [email protected] or use the Contact Us page.

Recent posts

  • Pros and Cons of Dividend Investing
  • Should I invest if I want to retire early?
By Published On: November 11, 2015

Share This Story, Choose Your Platform!

Wiser Wealth Management, Inc (“Wiser Wealth”) is a registered investment advisor with the U.S. Securities and Exchange Commission (SEC). As a registered investment advisor, Wiser Wealth and its employees are subject to various rules, filings, and requirements. You can visit the SEC’s website here to obtain further information on our firm or investment advisor’s registration.

Wiser Wealth’s website provides general information regarding our business along with access to additional investment related information, various financial calculators, and external / third party links. Material presented on this website is believed to be from reliable sources and is meant for informational purposes only. Wiser Wealth does not endorse or accept responsibility for the content of any third-party website and is not affiliated with any third-party website or social media page. Wiser Wealth does not expressly or implicitly adopt or endorse any of the expressions, opinions or content posted by third party websites or on social media pages. While Wiser Wealth uses reasonable efforts to obtain information from sources it believes to be reliable, we make no representation that the information or opinions contained in our publications are accurate, reliable, or complete.

To the extent that you utilize any financial calculators or links in our website, you acknowledge and understand that the information provided to you should not be construed as personal investment advice from Wiser Wealth or any of its investment professionals. Advice provided by Wiser Wealth is given only within the context of our contractual agreement with the client. Wiser Wealth does not offer legal, accounting or tax advice. Consult your own attorney, accountant, and other professionals for these services.

Sign up for our newsletter!

Our latest blogs, podcasts, and educational videos delivered to your inbox weekly.