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New Research Reveals Drivers Impacting Retirement Plan Fees

A study assessing the mechanics of what drives the 'all-in' fee


The Defined Contribution/401(k) Fee Study research report, conducted by Deloitte and sponsored by the  Investment Company Institute (ICI), looks at total fees charged across a broad sample of defined contribution plans with a range of plan sizes, service levels, investment offerings, service providers and fee structures. This study of 130 plans reveals that lower fees are closely related to a number of factors, including the size of the plan, higher contribution rates by employers and employees, and greater use of automatic enrollment. Among other notable findings:

  • The number of participants and the average account balance are primary drivers of fees
  • Secondary drivers can affect fees for these companies, such as the structure of their plan and their plan sponsor, their plan sponsor’s relationship with their plan service provider and allocation of assets to equities
  • Factors that do not drive fees include the number of payrolls that a plan sponsor has; whether plan services are provided by a mutual fund sponsor, life insurance company, bank or third party; the plan’s tenure with the service provider; or the percentage of assets invested in proprietary investments of the service

Download the complete report.

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