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Asset Exchanges

Q: A third party administrator’s (TPA) personnel are saying that 403(b) accounts are individual contracts and they will not change the contracts to a group contract. Is it correct that if the participants wish to sign off on an “exchange” form they will honor the asset exchange, liquidate the assets and transfer them to the new TPA on an individual basis?

A: This is consistent with the exchange rules, but you need to be sure the plan document permits exchanges among approved providers in the plan.

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