The Wall Street Journal today had an article (which you can now access through SFGate.com) entitled “As returns sag, employers turn up heat on 401(k) fees” which provides details of how some employers have negotiated lower fees in their 401(k) plans. An excerpt from the article:
Employees with money in . . . [401(k)] plans are paying steep and largely invisible fees that are eating into their quarterly returns and their eventual retirement payout.By law, employers are supposed to make sure their retirement plans don’t overcharge employees. But until recently, few employers took this responsibility seriously. That has changed in the wake of mutual fund scandals, government pressure and the three-year bear market that has eroded many retirement accounts. A growing number of employers are demanding — and very often winning — lower management fees.
Also, another article from the Wall Street Journal today–“How You can Tell If Your 401(k) Fees are Too High“–focuses on how employees can get involved in understanding the fees being paid:
It’s all about the fees. In the late 1990s, the big worry for 401(k) participants was whether their plan had the latest technology fund to top the performance charts. Now, the concern is that the companies that manage the plans are charging too much. . . . For employees, it’s an opportunity to ask for information that will help them determine whether they’re overpaying and help them ask for changes in their plans.
Read more about 401(k) plan fees in this previous post here.