Letter for Participants

If you are a participant in your company’s retirement plan, here is a letter you can write to your employer which contains a list of questions that will help you determine the nature and extent of the fees that are being taken out of your retirement account.  If you are hesitant to contact your employer, you can send the first four questions to your retirement plan provider as well.

To:  Human Resources Department
From:  Your Name
Re:  My Retirement Plan


Dear ________ :

I am in the process of reviewing my retirement plan and I am trying to gain a better understanding of all the fees I am paying in my plan.  I have the following questions:

  1. What have I been charged each year since I’ve been a participant in the plan for recordkeeping, custodial, administration, and advisory fees in hard dollars?  How do I find this information on my account statement?
  2. How are these fees being assessed?   Am I paying a flat fee for these services?  Or are these fees based on my account value, and if so, are they included in each individual fund?  If the latter, do some funds have different recordkeeping, administrative, and advisory fees than others?
  3. If I am not interested in utilizing the services of the investment advisor, can I opt out of this fee?  For example, can I choose funds that don’t include investment advisory fees?  If so, which funds do not have these fees?
  4. I have learned that there is a total stock market index fund through Charles Schwab available in retirement plans at a cost of 0.03%.  Is this fund available in our plan?
  5. Does the person in charge of selecting the service providers have relationships with any of these parties that may compromise the objectivity of the provider selection process?
  6. Are you familiar with http://401kprovidersearch.com, which lists a range of affordable and high quality service providers, and have you compared the cost and quality of their services to what I am currently paying for and receiving?




Your Name