We’re excited to talk about our free plan review offer today. This is a process where we examine the cost, services, and performance of your current retirement plan and do a live benchmarking to prepare it for other providers.
What does benchmarking a retirement plan really entail? There are three main areas: cost, services, and investment performance. Today we’re going to cover the first part of the benchmarking process by talking about cost.
There are three different types of fees in a retirement plan. There are investment fees, which is the cost to manage the investment. There are also administrative fees, which can be for things like record keeping, compliance, or other administrative duties. The third is the advisory fee, which is a fee or commission paid to the financial advisor or broker.
Investment fees are the only fees that are always paid by the employee. The administrative and advisory fees can be paid by the employee or the employer. The reason why most employers don’t know what they’re currently paying is that employees are typically paying the majority of the cost and they don’t even know it. As with any product or service, the lowest fee is not always the best. There are qualitative factors to take into consideration when comparing your options.
On the other hand, if you’re overpaying for your funds or services, this can have a dramatic effect on your employees’ retirement accounts. So how can you learn how much you are currently paying as a plan sponsor and how much your employees are paying? Simply send me an email or give me a call and we’ll put together a free plan analysis of your current plan so you know exactly what you’re paying and how that compares to your peers.
Stay tuned for our next two blogs, where we will be discussing how to benchmark the services and investment performance of your plan. If you have any questions for us in the meantime, don’t hesitate to give us a call or send us an email. We hope to hear from you soon.We’re excited to talk about our free plan review offer today. This is a process where we examine the cost, services, and performance of your current retirement plan and do a live benchmarking to prepare it for other providers.