Moira, Great question. These are normaly difficult to see. You can contact your company contact that works with the admisistrator of the plan and ask for a copy of thier list of fees for the administration of the plan and the average Mutual Fund fees. Good luck Dan
Your 401k will always have fees. The only question is how much they are, and if you pay all of them, or if your company picks up some of the cost. This website, brightscope.com, is a great place to start your research. Type in your company name in the search box above and you can get some basic information.
Also, by July 1st of this year all 401k service providers are required to disclose their fees to the plan sponsor (employer), and then by the end of August it is required that employees receive this fee information.
You can be sure that there are fees in there somewhere. At the end of August you should get some basic information about the fees you are paying. Sometimes it is quite difficult to figure out on your own, since a lot of the fees are "built-in" to the products. You could ask your plan administrator and/or the financial service provider (Principal?), If you feel comfortable doing so. It always good idea to make such requests in writing or in an e-mail. You could always confirm a conversation in writing as well, spelling out what your were told.
If your 401-K is an ERISA plan and subject to the new Department of Labor 408(b)(2) regulations, there are new duties for both Covered Services Providers (people and entities that provide services to the plan, such as lawyers, actuaries, accountants, investment advisors, etc) and Responsible Plan Fiduciaries(Trustees and Plan Administrators).
Some of the investment related fees to look for are: Sub TA Fees (sub transfer agent fees) 12(b)(1) Fees Load Fees (Front-end and Back-End) Expense Ratios: Mutual Fund and Exchange Traded Fund (ETF) Internal Management Expenses Redemption Fees Exchange Fees Account Fees Unitized Variable Annuity Wrap Fees
You should get a copy of the Summary Plan Description for your plan. Get the prospectus and fact sheet for each of the plans investment choices (you will certainly find fees there). If your plan invests in funds with “Ticker Symbols” , like MALOX, the ticker for Blackrock Global Allocation Fund Institutional share class (one of my favorite tickers). You can also get look at the Form 5500, which is likely here on the BrightScope Site, which should provide you with some information about plan costs.
Below is a discussion of the new regulations:
The Employee Retirement Income Security Act (ERISA) requires plan fiduciaries, when selecting and monitoring service providers and plan investments, to act prudently and solely in the interest of the plan's participants and beneficiaries. Responsible plan fiduciaries also must ensure that arrangements with their service providers are reasonable and that only reasonable compensation is paid for services. Fundamental to the ability of fiduciaries to discharge these obligations is obtaining information sufficient to enable them to make informed decisions about an employee benefit plan's services, the costs of such services, and the service providers.
Under the new 408(b)(2) regulations:
Covered Service Providers (CSPs) have a Duty to Disclose.
Under 408(b)(2) CSPs have a duty to disclose information concerning direct and indirect compensation, as well as potential conflicts of interest. If a service provider fails to provide the required information, the contract or arrangement between the plan and the service provider is prohibited by ERISA, and the plan fiduciary will have engaged in a prohibited transaction.
Responsible Fiduciaries have a Duty to Secure Discloser from Covered Service Providers.
If any CSPs fail to provide the disclosure required under 408(b)(2) , the Responsible Fiduciaries need attempt to secure the required disclosure from the CSP, and if the CSP still fails to disclose the Responsible Fiduciaries need to report that failure to disclose to the DOL.
Responsible Fiduciaries have a Duty to Disclose to Plan Participants:
There is a duty to make an initial, “disclosure to plan participants the initial annual disclosure of “plan-level” and “investment-level” information (including associated fees and expenses) must be furnished no later than August 30, 2012 (i.e., 60 days after the 408(b)(2) regulation’s July 1 effective date). The first quarterly statement must then be furnished no later than November 14, 2012 (i.e., 45 days after the end of the third quarter (July through September), during which initial disclosures were first required). This quarterly statement need only reflect the fees and expenses actually deducted from the participant or beneficiary’s account during the July through September quarter to which the statement relates”.
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