How does everyone feel about the programs which have an asset wrap fee?
I have CalSTRS Pension2 because their advertising is what initially pushed me to begin 403b contributions. The fund options are good. The program is also fantastic for beginners because the 0.25% asset wrap fee means a beginner's fees are tiny. Because Voya does the record keeping, the website and mobile app are top notch too.
However, I worry about a time when a participant might have 100k, $250 fees, 200k, $500 fees, 1 million, $2500 fees. These upper end scenarios seem like a steep price to start low. I believe many would pay a bit more early to avoid $2500 a year for potentially decades later.
I plan to stick with it and if the worry gets the best of me once I hit 50-100k, switch to a flat based fee provider. In the meantime, I hope a cap might come along, I would probably feel comfortable if they capped the asset fee at $250 per year considering the institutional shares they offer make up for some of that.
In this world when we push for the lowest fees possible, these asset fees bug me a bit even though I am happy to pay my fair share into a program.