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Net Worth Advisory Group of Salt Lake City, Utah, Highlights Excessive 401(k) Fees and What to Do

401(k) plans can involve a long list of costs and fees, some of which are covered by the employer and some by the employee. However, with some effort and diligence, you have the ability to drastically reduce these costs.

 
PRLog - Jan. 21, 2011 - 401(k) plans can involve a long list of costs and fees, some of which are covered by the employer and some by the employee. Below is a quick sampling:

• record keeping fees
• annual audit fees
• back-end loads
• brokerage commissions
• contract administration fees
• distribution expenses
• expense ratios
• front-end loads
• installation fees
• investment transfer expenses
• loan fees
• participant education fees
• plan document filing costs
• termination fees
• trustee service costs
• wrap fees
• 12b-1 fees
• management fees
• mortality & administrative fees
• nondiscrimination testing fees

These costs and extra fees can eat away at your retirement account and your hard-earned money. Currently, some 401(k) plans are costing participants as much as 3% to 4% per year. However, with some effort and diligence, you have the ability to drastically reduce these costs.

Reducing these costs just slightly can help increase your nest egg. If just 1% of annual cost is eliminated and you achieve a net return of 8% rather than 7%, an account will be worth 32% more in 30 years. In dollars, this would turn your $758,000 nest egg into a $1 million dollar retirement account.

In an effort to make fees more transparent to plan participants, amended provisions of ERISA Regulation 408(b)(2) must be implemented by July 16, 2011. This legislation will require investment managers and advisors to disclose all investment costs in a written itemized format. These new regulations will help you know the costs you are paying for your 401(k) plan.

This is a big step forward, but it doesn’t eliminate the personal responsibility of plan participants to demand information about their plan’s costs. You must take an active role in requiring your employer to choose low-cost retirement programs. If you find the costs of your employers’ 401(k) plan to be excessive, put pressure on the HR department to consider alternative plan providers.

More information can be obtained at http://utahfinancialadvisor.blogspot.com.

About Mr. Jefferies

Lon Jefferies is an investment advisor representative with Net Worth Advisory Group, a fee-only financial planning firm in Salt Lake City, Utah. He is a member of the National Association of Personal Financial Advisors (NAPFA) and a candidate for CFP™ certification. He possesses an MBA and bachelor's degrees in Finance and Marketing from the University of Utah. Lon writes articles for local magazines such as Business Connect and Utah Business Magazine, and he consistently contributes articles to online magazines such as FIGuide.com and FILife.com (by The Wall Street Journal). Additionally, Lon is a platinum expert author at EzineArticles.com. Lon has been quoted nationally in publications such as the NY Times and Investment News.

Contact Info

View Lon's blog at http://www.utahfinancialadvisor.blogspot.com, and visit Net Worth Advisory Group's home page at http://networthadvice.com. Lon can be emailed at lon@networthadvice.com, or phoned at (801) 566-0740.

# # #

Fee-Only Financial Planner
Net Worth Advisory Group
6975 Union Park Center, Suite 465
Midvale, UT 84047

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Contact Email:
***@networthadvice.com Email Verified
Source:Net Worth Advisory Group
Phone:801-566-0740
Zip:84101
City/Town:Salt Lake City - Utah - United States
Industry:Business, Finance, Services
Tags:401(k), 401k, fees, costs, investment, investing
Shortcut:prlog.org/11241004
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