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Message
Anyone else have crazy fees in 401k vs Ira
Posted on 9/1/16 at 7:36 am
Posted on 9/1/16 at 7:36 am
I know the fees are more but some of these are crazy
Vanguard total stock has the lowest expenses of my options, go figure, but is still at 1.10 in my 401k vs I believe .05 in my Ira
How do they get away with blowing up the fees so much?
Vanguard total stock has the lowest expenses of my options, go figure, but is still at 1.10 in my 401k vs I believe .05 in my Ira
How do they get away with blowing up the fees so much?
3
Posted on 9/1/16 at 7:54 am to ragacamps
Different share classes baw
Posted on 9/1/16 at 8:14 am to Thib-a-doe Tiger
I think the answer is much more than that.
If anything his 401k plan should definitely carry the admiral shares making the cost lower. Assuming he is looking apples to apples.
That's just the plan administrator making money. Not that there is anything wrong with that.
If anything his 401k plan should definitely carry the admiral shares making the cost lower. Assuming he is looking apples to apples.
That's just the plan administrator making money. Not that there is anything wrong with that.
Posted on 9/1/16 at 10:31 am to RJSambola
Even the institutional share class is way way cheaper
I have admiral in my ira
I have admiral in my ira
Posted on 9/1/16 at 10:51 am to RJSambola
quote:
That's just the plan administrator making money. Not that there is anything wrong with that.
there certainly is something wrong with it.
my fees aren't too bad, but my fund choices kinda suck.
Posted on 9/1/16 at 11:05 am to ragacamps
Seems to me that 401k fees are high for the same reason healthcare costs are high: employment lock cripples the market incentive to lower costs.
Posted on 9/1/16 at 1:18 pm to Iosh
Your company probably pays a fiduciary/advisor 3 basis points of the plan balance per year (that likely comes out of your balance as a pro rata share) which raises your fees in the 401k.
Posted on 9/1/16 at 1:43 pm to Hawkeye95
I don't blame the plan administration for the fees, i blame a lazy hr department.
If a company can get away with charging it - good for them, shame on whomever is making the decision to go with that plan with high fees and poor choices.
If a company can get away with charging it - good for them, shame on whomever is making the decision to go with that plan with high fees and poor choices.
Posted on 9/1/16 at 3:13 pm to RJSambola
It kind of pisses me off.
We need to contribute a good bit to each of our plans to lower our taxable income so I need to contribute at least 12%
Just pissed at the fees when I have the same fund in my Ira at a .05 expense ratio
We need to contribute a good bit to each of our plans to lower our taxable income so I need to contribute at least 12%
Just pissed at the fees when I have the same fund in my Ira at a .05 expense ratio
This post was edited on 9/1/16 at 3:15 pm
Posted on 9/1/16 at 3:48 pm to RJSambola
quote:
i blame a lazy hr department.
I'm also not sure how hard HR departments work on this. I think a lot of them are idiots when it comes to these, and some salesman comes in and sweeps them off their feet on some benefit that doesn't even matter so they pick them.
I think if more people gave their HR dept grief or tried to help them find better options, they would be able to.
Posted on 9/1/16 at 3:52 pm to ragacamps
401k plans typically have crappy fees and not very good investment choices.
The only reason anyone uses them is because of the ease of contribution, matching, and higher contribution limits.
It is a bit of a racket.
The only reason anyone uses them is because of the ease of contribution, matching, and higher contribution limits.
It is a bit of a racket.
Posted on 9/2/16 at 10:06 am to LSUFanHouston
401k plans require administrators. Administrators require payment. It is as simple as that. Administering 401k's is a good gig. It is a shame that some administrators are so lazy they limit the investment options of plan participants. I wonder why there hasn't been a class action suit challenging a plan administrator's fiduciary duty to act in the best interests of the plan participants over the higher fees of the limited investment options. If Fund A has .05% fees and Fund B has .10% fees, shouldn't the administrator have an obligation to make Fund B available?
Posted on 9/2/16 at 11:29 am to Poodlebrain
I have a good bit of options. With three vanguard funds in them. And go figure those three are the lowest fees out of all my choices. But man it's just crazy to hold the same fund in my IRA with a .05 and the same fund (different share class I know) is a 1.25 expense ratio in my 401k
Erks me
Erks me
Posted on 9/2/16 at 6:13 pm to Poodlebrain
I'm the 401k and profit sharing plan administrator for my company's plan. I have been arguing for years to get more investment choices instead of just one fund per style ie one Large Cap fund choice. I want 3 funds per style that way we as a company can't be accused of essentially endorsing a fund. If a say the large cap value fund isn't doing well, you have no other option to pick from. You can go large cap growth but that may not be doing well either. Out fiduciary then scores our choices in this scorecard system and after so many quarters of not doing well will recommend replacement funds. Anyway we pay 1 basis point per quarter for this pro rata. Fidelity is 3 basis points total once per year and is cheaper.
There are 401k lawsuits coming due to high fees in the plan. Morgan Stanly just had one and Vanderbillt just got hit with one. There are some new regulations coming in October that relate to 401k plans so we may be able to get rid of this fiduciary or may have to revamp plan fees. Whenever we add funds I ask for several and get all the information regarding fees to make sure they aren't out of whack.
There are 401k lawsuits coming due to high fees in the plan. Morgan Stanly just had one and Vanderbillt just got hit with one. There are some new regulations coming in October that relate to 401k plans so we may be able to get rid of this fiduciary or may have to revamp plan fees. Whenever we add funds I ask for several and get all the information regarding fees to make sure they aren't out of whack.
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