SURVEY SAYS – How Much is Your 401(k)?

August 27, 2009 (PLANSPONSOR.com) - This week I also asked readers if they knew what they were paying for their defined contribution plan account - if so, how much they thought that was - and if they thought that was fair.

Well, a plurality said they knew, and more than half thought that was fair.   Of course, that may have something to do with how much they thought they were paying.  

First things first; 42.9% said they knew how much they were paying for their account, though a full 25% said they didn’t know, about 18% said they weren’t sure, and roughly 14% said they thought they knew how much they were paying.

How Much?

Now, among those who did know (or thought they knew), a clear plurality (38%) said it was costing them less than $100/year.   That was twice as many as the second-most cited category – 17.5% – who said they had “no earthly idea” on how much they are paying.   As for the rest of the responses (which were not subsorted by plan size, account balance, or provider, by the way:

15.9% – Between $100 and $250

12.7% – Between $250 and $500

   4.8% – Between $500 and $750

  4.8% – Between $750 and $1,000

The rest – about 6%  said they were paying $1,000 or more.

Is It Reasonable?

As for reasonableness, a full 57% said they thought the fee charged for their account was "reasonable", though a third ( 32% ) said they weren't sure because they didn't know how much they were paying.   Roughly 3% said they weren't sure because they didn't know how much they were paying, and 8% said "no."

Thanks to everyone for participating in our survey!

«