Some Disclosure on Disclosure

It seems many 401(k) plan sponsors aren't that sure that the fees associated with their plans have been fully disclosed. This according to a Planadviser.com article about a recent survey of 150 defined benefit plan sponsors.


One item from the article that we're especially interested in is that more sponsors are implementing fee monitoring and benchmarking. Of them, 68% just started this process within the last year. It's clear the recent 401(k) lawsuits and proposed regulations in Congress and the Department of Labor are making employers pay attention to what their employees are paying in fees.


We're definitely happy to see that.


However, one thing to note about this survey is that 87% of the respondents were from companies that had 1000 or more employees. We wonder how much different the numbers would be if more smaller businesses had been included in the survey.


Here's a link to the full article on the lack of confidence in 401(k) fee disclosure.

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401(k) Fee Smoke and Mirror Show Continues

Score another one for those with the deep pockets.

Last month, with very little media attention, H.R. 3185, which would have required greater disclosure of 401(k) fees to plan participants, was defeated. Bill sponsor, Rep. George Miller, D-CA., announced that the bill would not be passed this year.

One of the main arguments from the 401(k) industry and the Department of Labor is that the bill would make disclosure of fees to plan participants more complex and expensive than it needs to be. So, in other words, they're saying it would cost more money to disclose the ridiculously high fees they are already charging (and legally hiding from) plan participants.

Well, the 401(k) industry may be right about this bill being more expensive, but only for them - not plan participants. We believe the bill would result in lower expenses overall for many plan participants. It would finally give participants easier access to the information they need to pressure employers to offer lower cost 401(k) options that don't unneccesarily erode their retirement savings.

We think H.R. 3185 is a very good step in the right direction. We hope the House will take it up again next year and that it will pass. 401(k) plan participants deserve to know exactly what their plans are costing them.

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"401(k): Hidden Fees" Investigative Report on Bloomberg TV

An investigative report on hidden fees in 401(k) plans premiers on Bloomberg TV tomorrow night (Thursday, June 19 at 7PM and 9PM EST).

The report will cover how fees are eating away at 401(k) balances without plan participants even realizing it and how even financial experts have trouble uncovering these fees. If you have a 401(k) plan, and especially if you sponsor one, be sure to tune into what we're sure will be a truly enlightening report.

To get more information go to Bloomberg TV and look for 401(k): Hidden Fees - What's hiding in the fine print of your 401(k).

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