If you have a 401k, 403(b), or 457 plan, you may be losing money to overpriced investments and hidden costs. Understanding 401k fees can empower you to potentially lower these costs.
If you haven't looked closely at your retirement plan fees lately, now is a good time for a checkup.
Your 401k Plan Definitely Has Fees
All plans have fees. Investment management fees pay financial professionals to manage the investments available through the plan, such as mutual funds. Administrative fees pay for tasks such as issuing statements, running the employees' account management website, and providing customer service. Understanding these 401k fees is crucial as they can affect your retirement savings over time.
Employees Often Pay Most of the 401k Fees
While the costs may be shared, most employees are likely paying for the bulk of the fees associated with their accounts. Your employer must disclose fee information annually, including details about how much is being deducted from your account for the above mentioned expenses. Understanding the structure of retirement plan fees is essential.
You Can Control Some of Your 401k Fees
You may have more control over 401k fees than you think. For example, you can do a little research and choose the investments within your plan that have the lowest fees while also taking your goals and risk tolerance into account. You have little control over administrative fees, but you can try to lobby your employer for lower fees if you discover they're unreasonable.
Need More Guidance on Retirement Plan Fees
Do you need additional guidance as you analyze your retirement accounts and fees? Understanding 401k fees and retirement plan fees can be complex. Reach out if you'd like to go over your questions.
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