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Why Your Fidelity, Empower, Paychex, Transamerica, or Other Corporate Plan Provider Is Costing You and Your Employees Thousands More

401(k) Plans Financial News

Key Takeaways

  • The larger retirement plan providers will usually cost small businesses more money, than if they were to go with a small business retirement plan provider.
  • Employers should pay close attention to the fees associated with their retirement plan.
  • Conglomerate third-party administrators like Empower, Fidelity, Transamerica, Northwestern Mutual, Prudential, ADP, BlackRock, Principal Financial Group, all have histories of charging exorbitant hidden fees to small business retirement plans with limited assets invested in retail fund classes.

The devil is in the details, the fees costing you thousands unknowingly are there too.

"Nearly three in five employees rank retirement planning assistance from financial professionals as a high priority when choosing where to work... The study revealed 69% of employees said they are paying more attention to reviewing their financial benefits this year, up nine percentage points from last year. " - Remy Samuels from PLANSPONSOR

We can all sigh in collective relief that 401(k) participants are ✨finally✨ starting to pay closer attention to the details surrounding their retirement plans. The main objective of Fi401k Advisors, LLC, our valued 3(38) investment managers and fiduciary partners.

No one has the ability to be an expert in every area of their life, and that is what fuels our local economies! Moreover, you don't need to be a financial expert to know you need to be saving as diligently, as you do skillfully, to have a dignified retirement.

After reading, we couldn't help but also think of the article Mark Gutrich wrote a few years back, "Revenue Sharing: The 401(k) Industry’s Dirty Little Secret":

- Detailing the concept of "revenue sharing";
- Elaborating on retail investment fund fees;
- How particularly insurance companies repackage mutual funds, to reap more profits from their clients' retirement account fees (*cough cough* Transamerica, Northwestern Mutual, Principal Financial Group, Prudential Financial);
- And how gigantic asset managers use "marketing" and "accounting" retail fund fees to pad profits (*loudly clears throat* Fidelity Investments, BlackRock, ADP).

The devil is most certainly in each of their 20 page, 9-11 point font, multi-year contracts... and it is likely costing you AND your employees thousands annually without your knowledge.

The take-away should be this, the most well-known retirement plan providers had to step on and outspend the "little guys" in order to get where they are- it's important you investigate how their boots left an imprint on your SMB peers, and their retirement plans. 🐸 🍵

> PLANSPONSOR Article Link:

> Fi401k Advisors, LLC "Revenue Sharing: The 401(k) Industry’s Dirty Little Secret":

> Morgan Stanley State of Workplace Study:

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