How to open a company retirement account (CRA)

How to open a company retirement account (CRA)

company retirement account (CRA) is not a retirement plan; it is a cash brokerage account for employer-sponsored retirement plans allowing investing and trading of existing retirement plan assets through Schwab. CRAs accommodate a variety of plan types, including 401(k), Roth 401(k), money purchase pension plans, profit sharing plans, defined benefit plans, and non-qualified plans.

Note: 403(b)(7) plan is not available at Schwab.

With a CRA, trustees can keep all of their assets in a single pooled account or set up separate accounts for each of the employee participants. Trustees can also name employees as authorized traders on the account, giving them permission to direct the investments of their own account.

You can open a CRA using DocuSign® or paper forms.

All processes
  • A completed Company Retirement Account Fee Disclosure Worksheet and Company Retirement Account (CRA / Pension Trust) (use the application instructions for more information):
    • Your firm name, master account number, and contact information
    • Information for the employer's plan, including business name, employer's federal tax identification number, business address, phone number, name of plan, plan tax identification number, plan representative contact name, and current plan type
    • Information for the company and trust, including company name, phone number, legal address, employer identification number (EIN), country of establishment, state of legal establishment, trust name Tooltip , plan tax identification number, effective date of trust, and name of employee participant, if applicable
    • Information for the trustee, including name, known-by name, home address (no P.O. boxes or investment advisor addresses), mailing address (if different from home address), business address, home phone number, birth date, country of legal residence, all countries of citizenship, identification number, employment status Tooltip , and employer name
    • Information for the participant Tooltip , including name, known-by name, birth date, employment status, country of legal residence, all countries of citizenship, and identification number
    • Business and employer information is not required if the client is retired or non-employed. 
  • Adobe® Reader® or Adobe Acrobat® 7.0 or higher (download the latest version on the Adobe website)
  • If the trustee or participant is affiliated with a member firm of an exchange or FINRA and Rule 3210 applies, a FINRA Rule 3210 Consent Letter
In addition to the information above, the following may be required:
Additional features

 

 

Account opening method

If using DocuSign to submit forms:

  • For existing Schwab clients, a complete Schwab Advisor Center® profile with the account holder’s current email address and mobile phone number
  • For new-to-Schwab clients, the email address and mobile phone number
  • All clients must use either: 
    • Alliance Authentication (only available when starting the envelope within Schwab Advisor Center), or
    • Both text message (SMS) authentication and Knowledge Based Authentication (KBA) for DocuSign (available in both Schwab Advisor Center and the DocuSign Console)

For details, see How to use DocuSign.

  1. Either you or the plan trustee must complete a Company Retirement Account Fee Disclosure Worksheet to establish a new CRA plan. One fee disclosure is required for each plan tax ID.

    IfThen
    Indicates the trust allows for segregated accounts:You must complete a Company Retirement Account (CRA / Pension Trust) form for every participant (regardless of the number of participants) on the account.
    Allows segregated accounts and allows the participant to trade directly with Schwab:The participant must initial and sign the application to be given the PPART role.
    Allows segregated accounts but does not allow participants to trade directly with Schwab:The participant is added with a status of for benefit of (FBO) only. Trustees that are also participants must initial and sign for both roles.
  2. Print the form(s) not available for DocuSign and obtain signatures from each trustee and participant (if applicable). Send the signed form(s) to your Schwab service team via a Schwab Advisor Center service request.

This process may be used to open a CRA using paper forms, if not eligible for DocuSign.

  1. Either you or the plan trustee must complete a Company Retirement Account Fee Disclosure Worksheet to establish each new CRA plan. One fee disclosure is required for each plan tax ID.
  2. Send the signed form to your Schwab service team via a Schwab Advisor Center service request. Once Schwab receives the completed worksheet, we will generate a 408(b)(2) Tooltip disclosure packet and mail the packet to the applicable plan trustees. Allow six business days for the trustee to review the fee disclosure documents and to respond with any concerns.
  3. When the worksheet processing is complete, go to the forms library on Schwab Advisor Center and select Open Account – Company Retirement Account. Expand the list, click Select, and then select Open PDF for the Company Retirement Account (CRA / Pension Trust) form as well as any other applicable forms.
  4. Complete all necessary fields and ensure all additional features the client requested have been added.

    IfThen
    Indicates the trust allows for segregated accounts:You must complete a Company Retirement Account (CRA / Pension Trust) form for every participant (regardless of the number of participants) on the account.
    Allows segregated accounts and allows the participant to trade directly with Schwab:The participant must initial and sign the application to be given the PPART role.
    Allows segregated accounts but does not allow participants to trade directly with Schwab:The participant is added with a status of for benefit of (FBO) only. Trustees that are also participants must initial and sign for both roles.
  5. Print the form(s) and obtain signatures from each trustee and participant (if applicable). Send the signed form(s) to your Schwab service team via a Schwab Advisor Center service request.

Once you have submitted your request:

  • For forms submitted using DocuSign, see the What's next? section of How to use DocuSign.
  • Participants granted trading authority on the CRA master account application by the trustee, are now able to trade directly with Schwab.
  • The account holder should consult with their tax advisor if they have any questions about tax implications.
  • Contact your service team with questions about opening a company retirement account.

Go to the Forms library on Schwab Advisor Center and select the forms below.

Form: Company Retirement Account (CRA / Pension Trust)
Form: Company Retirement Account Fee Disclosure Worksheet
Form: Power of Attorney (Individual POA)
Form: Options Trading and Margin Application
Resource: 408(b)(2) FAQs

 

Who is a CRA for?
A CRA may be right for:

  • A business owner or plan administrator with an established retirement plan.
  • Companies interested in using a customized plan document or working with a specific plan administrator.
  • Businesses with their own retirement plan or trust document and want to invest all or part of the plan assets at Schwab.

What are my clients’ options for setting up a CRA?
Your clients can establish a CRA in one of two ways:

  • They can manage all the plan assets in a single pooled account for the trust.
  • They can open separate accounts for each employee and let them manage their own investments.

What do my clients need to know about administering a CRA?
The plan administrator or trustee is responsible for tracking contributions and distributions and for any necessary IRS reporting. As the custodian of CRA assets—not the plan sponsor—Schwab does not provide any tax reporting or plan administration on these accounts.

Are investment choices limited on a CRA?
The Schwab CRA offers the same full range of investment choices available with all Schwab brokerage accounts, including asset allocation portfolios, mutual funds, stocks, and fixed investments such as bonds and annuities. However, participants should consult with the plan administrators to confirm if there are any investment restrictions under the specific CRA plan provisions.

What do I need to know to avoid delays in the application process?
The most common reasons for CRA application delays are:

  • Missing fee disclosure worksheets and applications—A worksheet is required for each plan TIN and for separate plans, and completed account applications are required for each participant.
  • Missing trust name and effective date of the trust–Both the business name and the trust name and effective date are required on the application.
  • Missing trustee or beneficiary information.
  • Blank form questions or form fields pertaining to Rules 407 and 3050.
  • Missing or illegible signature and dates.

How to add features to an account
How to establish a Schwab MoneyLink® profile
How to make trustee changes to company retirement accounts
Introduction to company retirement accounts (CRAs)
Introduction to householding