America’s Best 401k has upgraded its fee-checker tool, which provides plan sponsors and participants with free access to an online snapshot of the fees they pay for their retirement plans, as well as the resulting impact on investment returns.
The firm leverages analytical data and crowd sourcing to develop a comprehensive database where users can search plans by business name to find estimates of the investment-related fees in each company’s retirement plan based upon data from Form 5500 Internal Revenue Service (IRS) filings.
“We’ve collected and analyzed thousands of fee disclosures since launching America’s Best 401k, and the database that helps to power our fee-checker is extremely robust,” says Josh Jenkins-Robbins, chief strategy officer, America’s Best 401k. “For those familiar with Zillow’s home value ‘Zestimates,’ we use a similar method to generate estimates of the percentage of plan assets participants are paying out in fees. Once the business owner uploads a plan disclosure document, our team will provide an even more detailed analysis of the exact impact of fees upon retirement savings accounts.”
The firm notes this service could save participants hundreds of thousands of dollars. It can also help plan sponsors and businesses avoid costly litigation associated with allegations over breaching fiduciary duty by allowing excessive fees to be charged.
“The vast majority of the more than 533,000 401(k) plans in America are smaller plans with small and midsize businesses, and most of them pay much higher fees, as a percentage of plan assets, than larger plans at big companies,” says Tom Zgainer, CEO and founder America’s Best 401k. “Large company plans typically pay far less than 1% in annual fees, compared with 1-2% or more paid by most small plans. It’s not a level playing field and there is no reason it shouldn’t be. Our new and improved fee-checker gives these business owners, and their employees, a quick and easy way to get a clear picture of how much money 401(k) plan providers are draining from their retirement account. For many, it’s a startling wake-up call.”
For more information, visit Americasbest401k.com.