| Recently, there has been a lot of discussion in the media surrounding 401(k) plan fees. According to ERISA, in order to adequately serve as plan sponsor and fiduciary, it is your responsibility to manage plan fees and keep them "reasonable." Unfortunately, there is no specific definition in the law of what constitutes "reasonable." Therefore, you must use your own judgment to determine whether the fees being charged to the participants’ accounts are fair given the types and level of services provided.
Though no one will tell you whether one company's fees are too high, it is important that all of the costs associated with the plan be adequately disclosed and regularly evaluated. Through efficient plan investment menu design and suitable vendor relationships, you can ensure that your participants are getting the most out of their retirement plan for an appropriate and reasonable cost.
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