How will the Task Force determine if fees are competitive and reasonable?
Fee transparency and hidden fees have recently made headlines in the press and are the basis of new federal legislation under discussion. For large plans like the University’s, it is not uncommon for participant fees to more than offset actual recordkeeping costs. Moreover, when fees are paid through an expense ratio or as a percentage of assets, individuals with larger balances pay more for recordkeeping services than individuals with smaller balances. For recordkeeping services such as quarterly statements, a fixed per-participant fee, regardless of the account balance, may make more sense. Through the competitive bid process, service providers will be asked to identify the services they will provide and the cost to participants. Identifying the true costs of plan services and increasing the opportunity to pass savings along to participants is paramount in designing the enhanced retirement program.
Related Questions
- One of the Task Force goals is to ensure plan participants pay competitive fees for the investments and services provided. How are service fees paid today?
- How will service fees be paid in the future and how did the Task Force determine if fees were competitive and reasonable?
- How did the Mayor determine who would serve on the task force?
