401(k) Fee Disclosure, I Can Hardly Wait

Negative 401(k) fee article articles continue to appear. The most recent suggests that the fees in 401(k) target date funds (TDFs) are too high and it is unfortunate that plan sponsors have been given the ability to default 401(k) participants into these TDFs, or any other investment for that matter. There are fees for investing whether in an IRA, 401(k) or a retail account. Fees paid by participants in all but the smallest of small company 401(k) plans are the approximately the same as those paid by IRA investors and retail investors with similar investments. Large company 401(k) participants pay the world's lowest investment fees. Participants in very large 401(k) plans pay as little as two basis points.
This 401(k) fee reality holds true for TDFs which provide a duration sensitive, diversified portfolio that is periodically rebalanced--all excellent long term investment practices. To suggest that plan sponsors defaulting participants into TDFs are doing participants a disservice is nonsense.

I can hardly wait for fee disclosure so we will have the data to incontrovertibly prove that the fee structure of 401(k) plans is one of their greatest benefits and those writing negative 401(k) fee articles will be silenced forever.