Does your company’s 401(k) plan stack up with everyone else’s?

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Employers contribute $4,040 a year to workers' 401(k) plans on average -- how does your company stack up?

More than 97 million Americans have access to an employer-sponsored retirement plan. If your retirement savings is a portion of the $5.3 trillion invested in 401s, you may have wondered how your company’s plan — and the investment choices you have within it — stacks up to the competition. Let’s take a look.

That’s right on target, considering experts recommend saving 10% to 15% of your salary for retirement. About two-thirds of the 401 plans jointly analyzed by the Investment Company Institute and the Employee Benefit Research Institute offer target-date mutual funds. Known as a “set it and forget it” retirement investment, target-date funds include a mix of investments that automatically rebalance as you get closer to retirement. More than half of 401 participants are invested in target-date funds, according to the ICI and EBRI.

Let’s set the record straight: You are definitely paying 401 fees — between 0.20% and 5% of your balance, according to 401 analytics firm BrightScope, which says the larger the plan, the lower the fees. Although employers frequently cover a portion of the administrative costs, Callan’s research found that in 32% of plans, participants are on the hook for all fees.Your plan is required to send you a quarterly fee disclosure statement.

 

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$0 dollars from every single employer I've had. Both for-profit and non-profit.

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