401(k) plans can vary greatly from one employer to another and the available features can change the overall effectiveness of a 401(k) in a big way.
Recognizing the importance of these features, CEO Scott Holsopple discusses six features of a good 401(k) plan in his latest submission to the U.S. News & World Report.
In an excerpt from the post, Scott discusses one feature many do not think about:
“Value. A 2007 AARP study revealed that 65 percent of respondents believed they did not have any 401(k) fees. That number jumped to 71 percent when AARP conducted the survey again this year.”
“Your 401(k) is not free. All retirement accounts (including Individual Retirement Accounts) have fees, but those fees should be reasonable. According to the Employee Benefits Security Administration, fees for 401(k) plans fall into three major categories: plan administration fees, investment fees, and individual service fees. Your employer should negotiate the best available fees on your behalf in all of the major categories.”
What are your thoughts? Any other features we missed? Let us know in the comment section.
Smart401k is a web-based investment advisory service providing unbiased recommendations to help people invest in employer-sponsored retirement plans. Smart401k provides service to nearly 11,000 clients who collectively have more than $2 billion in assets. Plan participants receive personalized, fund-specific investment recommendations and the support of professional investment advisers available to discuss all investment questions. Based in Overland Park, KS, Smart401k is online at Smart401k.com.